COMMISSION STAFF WORKING PAPER IMPACT ASSESSMENT   Accompanying document to the
Date: 2010-12-14
Institutions: European Commission
Subjects: EU Member State, EU national, civil law, commercial law, enforcement of ruling, jurisdiction, mutual recognition principle

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EUROPEAN COMMISSION 

Brussels, 14.12.2010 
SEC(2010) 1547 final 

COMMISSION STAFF WORKING PAPER 

IMPACT ASSESSMENT 

Accompanying document to the 

Proposal for a  

REGULATION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL 

on jurisdiction and the recognition and enforcement of judgments in civil and 
commercial matters 

(Recast) 

{COM(2010) 748 final} 
{SEC(2010) 1548 final} 

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DISCLAIMER:  This  report  commits  only  the  Commission's  services  involved  in  its 
preparation  and  does  not  prejudge  the  final  form  of  any  decision  to  be  taken  by  the 
Commission 

TABLE OF CONTENTS 

COMMISSION STAFF WORKING PAPER IMPACT ASSESSMENT Accompanying 
document to the .......................................................................................................................... 1 

1. 

1.1. 

1.2. 

1.3. 

1.4. 

1.5. 

1.6. 

Background and Consultation of Interested Parties ..................................................... 6 

Background .................................................................................................................. 6 

Political mandate.......................................................................................................... 6 

Organisation and timing............................................................................................... 6 

Consultation and expertise ........................................................................................... 7 

The revision of the Regulation..................................................................................... 8 

Respect of Fundamental Rights ................................................................................... 9 

1.6.1.  Right to an effective remedy, Article 47 subparagraph 1 .......................................... 10 

1.6.2.  Right to a fair trial, Article 47 subparagraph 2 .......................................................... 10 

1.6.3.  Respect for private and family life (Article 7); Protection of personal data (Article 8) 
Freedom of religion (Article 10) ................................................................................ 10 

1.6.4.  Freedom of expression and information (Article 11)................................................. 11 

1.6.5.  Freedom to conduct a business, Article 16 ................................................................ 11 

1.6.6.  Consumer Protection, Article 38................................................................................ 11 

2. 

Problem Definition, Objectives and Assessment of Policy Options.......................... 11 

2.1. 

THE FREE CIRCULATION OF JUDGMENTS ...................................................... 11 

2.1.1.  Problem definition for the free circulation of judgments........................................... 11 

2.1.1.1.  The current problem................................................................................................... 11 

2.1.1.2.  Who is affected?......................................................................................................... 12 

2.1.1.3.  Scope of the problem ................................................................................................. 12 

2.1.1.4.  Need for EU action (Subsidiarity).............................................................................. 13 

2.1.2.  Objectives................................................................................................................... 13 

2.1.3.  Description of Policy Options.................................................................................... 13 

2.1.4.  Discarded Policy Options........................................................................................... 16 

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2.1.5.  Analysis of Impacts of Retained Policy Options ....................................................... 16 

2.1.5.1.  Policy Option 1: Status Quo....................................................................................... 16 

2.1.5.2.  Policy Option 3: Maintain exequatur but alleviate some of the burden for the 

applicant ..................................................................................................................... 17 

2.1.5.3.  Policy Option 4A: Abolition of exequatur with appropriate safeguards.................... 18 

2.1.6.  Comparing the Options and preferred Policy Option ................................................ 19 

2.2. 

THE OPERATION OF THE REGULATION IN THE INTERNATIONAL LEGAL 
ORDER ...................................................................................................................... 19 

2.2.1.  Problem definition for the operation of the Regulation in the international legal order

.................................................................................................................................... 19 

2.2.1.1.  The current problems ................................................................................................. 19 

2.2.1.2.  Who is affected?......................................................................................................... 22 

2.2.1.3.  Scope of the problem ................................................................................................. 22 

2.2.2.  Need for EU action (Subsidiarity).............................................................................. 22 

2.2.3.  Description of Policy Options.................................................................................... 23 

2.2.4.  Discarded policy options............................................................................................ 24 

2.2.5.  Analysis of impact of retained policy options............................................................ 25 

2.2.5.1.  Policy Option 1: Status quo........................................................................................ 25 

2.2.5.2.  Policy Option 3A: Minimum harmonisation of the rules on jurisdiction .................. 25 

2.2.5.3.  Policy Option 4A: Full harmonisation of the rules on jurisdiction............................ 26 

2.2.6.  Comparing the options and preferred policy option .................................................. 27 

2.3. 

CHOICE OF COURT AGREEMENTS .................................................................... 27 

2.3.1.  Problem definition for the Choice of Court Agreements ........................................... 27 

2.3.1.1.  The current problem................................................................................................... 27 

2.3.1.2.  Who is affected?......................................................................................................... 29 

2.3.1.3.  Scope of the problem ................................................................................................. 29 

2.3.2.  Objectives................................................................................................................... 30 

2.3.3.  Need for EU action (Subsidiarity).............................................................................. 30 

2.3.4.  Description of policy options ..................................................................................... 30 

2.3.5.  Discarded policy options............................................................................................ 31 

2.3.6.  Analysis of impacts of retained options ..................................................................... 32 

2.3.6.1.  Policy Option 1: Status quo........................................................................................ 32 

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2.3.6.2.  Policy Option 2: Exempt the chosen court from the obligation to stay proceedings. 32 

2.3.6.3.  Policy Option 3: Give the chosen court priority to decide on its jurisdiction............ 33 

2.3.7.  Comparing the options and preferred Policy Option ................................................. 34 

2.4. 

INTERFACE BETWEEN THE REGULATION AND ARBITRATION ................ 34 

2.4.1.  Problem definition for the interface between the Regulation and Arbitration........... 34 

2.4.1.1.  The current problems ................................................................................................. 34 

2.4.1.2.  Who is affected?......................................................................................................... 35 

2.4.1.3.  Scope of the problem ................................................................................................. 35 

2.4.2.  Need for EU action (Subsidiarity).............................................................................. 36 

2.4.3.  Description of policy options ..................................................................................... 36 

2.4.4.  Discarded Policy Options........................................................................................... 37 

2.4.5.  Analysis of impacts of retained Policy Options......................................................... 37 

2.4.5.1.  Policy Option 1: Status quo........................................................................................ 37 

2.4.5.2.  Policy Option 2: Extend the exclusion of arbitration from the scope ........................ 38 

2.4.5.3.  Policy Option 3A: Enhance the effectiveness of arbitration agreements................... 38 

2.4.6.  Comparing options and preferred Policy Option ....................................................... 39 

3. 

3.1. 

3.2. 

3.3. 

3.4. 

3.5. 

3.6. 

3.7. 

4. 

5. 

6. 

Overall Evaluation of Impact of Preferred Policy Options........................................ 39 

Summary of the preferred policy options................................................................... 39 

The preferred options' effectiveness to achieve the policy objectives ....................... 40 

Economic impact........................................................................................................ 40 

Impact on financial costs............................................................................................ 41 

Impact on fundamental rights..................................................................................... 41 

Social impact.............................................................................................................. 41 

Impact on third countries ........................................................................................... 41 

Proportionality of EU Action ..................................................................................... 42 

Legal Basis ................................................................................................................. 42 

Monitoring and evaluation ......................................................................................... 42 

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Annex I –Glossary of legal terms............................................................................................. 44 

Annex II – Summary of Views of Stakeholders on the Main Aspects of the Revisin of 

Regulation Brussels I ................................................................................................. 48 

Annex III - Summary of Legal Studies conducted by the Commission................................... 50 

Annex IV A - Number and Cost of Exequatur Proceedings .................................................... 52 

Annex IV B – Example of itemised costs of exequatur ........................................................... 55 

Annex V - Length of exequatur proceedings ........................................................................... 56 

Annex VI – Effect of the Risk of Litigation Abroad on Cross Border Trade and Possible 

Impact of Abolition of Exequatur .............................................................................. 59 

Annex VII – Summary of relevant cases of the Court of Justice of the European Union ....... 61 

Annex VIII – National Protective Jurisdictional Grounds in Consumer, employment and 

insurance contracts ..................................................................................................... 62 

Annex IX - Main categories of specific national rules on jurisdiction excluded between 

Member States (listed in Annex I of the Brussels I regulation .................................. 64 

Lead DG – DG JUSTICE Agenda Planning No 2009/JLS/013 

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1. 

BACKGROUND AND CONSULTATION OF INTERESTED PARTIES 

1.1. 

Background 

Council Regulation (EC) No 44/2001 on jurisdiction and the recognition and enforcement of 
judgments  in  civil  and  commercial  matters  (known  as  "Brussels  I")1  is  the  matrix  of  civil 
judicial  cooperation  in  the  European  Union.  It  creates  a  secure  legal  framework  for  cross-
border legal proceedings in a broad range of civil disputes. The Regulation identifies the most 
appropriate  jurisdiction*2  for  solving  a  cross-border  dispute  and  ensures  the  smooth 
recognition* and enforcement* of judgments issued in another Member State. The Regulation 
replaced the 1968 Brussels Convention which had been concluded between the then Member 
States and successively amended to reflect the Union's successive enlargements. It applies in 
all  Member  States,  including  Denmark,  which  has  a  special  regime  for  judicial  cooperation 
under the Treaty.  

Regulation  Brussels  I  entered  into  force  in  March  2002.  Eight  years  afterwards,  the 
Commission has reviewed its operation in practice and considered necessary amendments to 
the  instrument.  While  the  Regulation  is  overall  considered  to  work  successfully,  the 
consultation of stakeholders and different studies conducted by the Commission revealed the 
need  and  potential  for  reform.  Cross-border  litigation  could  be  made  speedier,  cheaper  and 
more efficient. Moreover, the possibilities of using abusive litigation tactics could be reduced.  

1.2. 

Political mandate  

The European Council in its 2009 Stockholm Programme3 called for the further development 
of  the  European  area  of  justice  by  removing  the  remaining  restrictions  on  the  exercise  of 
rights  of  citizens  and  companies.  More  specifically,  judgments  in  civil  matters  should  be 
directly  enforceable  in  another  Member  State  without  any  intermediate  measures  being 
required.  Moreover,  access  to  the  courts  by  citizens  and  businesses  should  be  facilitated  in 
order to enable them to enforce their rights throughout the Union. Improved access to justice 
should  also  equip  economic  operators  with  tools  that  enable  them  to  benefit  fully  from  the 
single market, especially at a time of economic crisis.  

1.3. 

Organisation and timing 

The Commission's Work Programme for 2010 includes the adoption of a proposal for revising 
Regulation 44/2001 as a strategic initiative, for which a road map was prepared . 

The Commission commissioned an external study (hereinafter "the external study") to support 
the  preparation  of  the  Impact  Assessment4.  The  problems,  objectives  and  policy  options 
assessed in that study are based on the outcome of the consultation and the expertise brought 
together by the Commission to prepare the present initiative (see point 1.4 below) as well as 
contributions from the contractor.  

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OJ L 12, 16.1.2001, p.1.  
Legal terms marked by an asterix "*" are explained in the glossary contained in Annex I. 
Adopted at the meeting of the European Council of 10th and 11th December 2009. 
CSES  Centre  for  Strategy  &  Evaluation  Services,  Data  Collection  and  Impact  Analysis  –  Certain 
Aspects of a Possible Revision of Council Regulation No 44/2001 on Jurisdiction and the Recognition 
and Enforcement of Judgments In Civil and Commercial Matters (Brussels I). 

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This  report  also  incorporates  comments  submitted  during  two  meetings  of  the  inter-service 
steering group on 17 May and 3 September 2010 at which representatives of the Directorates- 
General  Communication,  Competition,  Employment,  Economic  and  Financial  Affairs, 
Enterprise  and  Industry,  Environment,  Health  and  Consumers,  Information  Society,  Internal 
Market and Services, Trade, Mobility and Transport as well as the Secretariat General and the 
Legal Service of the Commission participated.  

This  Impact  Assessment  was  reviewed  by  the  Impact  Assessment  Board  (IAB).  The 
recommendations for  improvements  have been accommodated  in this revised  version  of  the 
report. In particular, the following changes were made: the assessment of the benefits of the 
abolition of exequatur was revised; the views of stakeholders and the necessary adjustments in 
the  national  legal  systems  were  more  fully  presented;  the  justification  of  EU  action  on 
grounds  of  subsidiarity  was  expanded  and  the  justification  for  the  proposed  degree  of 
harmonisation of the rules on jurisdiction vis-à-vis third country defendants was strengthened.  

1.4. 

Consultation and expertise 

On  21  April  2009  the  Commission  adopted  a  Green  Paper  on  the  review  of  Council 
Regulation  (EC)  No  44/2001  on  jurisdiction  and  the  recognition  and  enforcement  of 
judgments in civil and commercial matters (COM(2009) 175). A total of 130 responses have 
been  received  and  are  available  on  DG  Justice's  website  (for  a  summary  of  stakeholders' 
views see Annex II)5.  

On the same date, the Commission adopted a report on the application of Council Regulation 
(EC) No 44/200 (COM (2009)174). In preparation of that report, the Commission has taken 
into  account  several  studies  commissioned  by  it,  the  respective  results  of  which  are 
summarised in Annex III: 

•  A 2007 study on the practical application of the Regulation conducted by Prof. Burkhard 

Hess, Thomas Pfeiffer, and Peter Schlosser (the "Hess report")6  

•  A  2007  study  to  evaluate  the  impact  of  a  possible  ratification,  by  the  European 
Community, of the 2005 Hague Convention on Choice-of-Court Agreements conducted by 
GHK7 

•  A 2006 study on subsidiary jurisdiction conducted by Prof. Arnaud Nuyts of the University 

of Brussels (the "Nuyts report")8 

•  A 2004 study on enforcement of judicial decisions in the European Union, conducted by 

Prof. Burkhard Hess from the University of Heidelberg9 

Empirical  data  supporting  the  preparation  of  this  impact  assessment  was  collected  by  the 
external  study  (see  point  1.3  above)  which  was  finalised  in  September  2010.  In  addition,  a 
survey  of  European  companies  on  commercial  disputes  and  cross-border  debt  recovery  was 
launched via the  European Business Test Panel10. This impact assessment also relies  on the 

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http://ec.europa.eu/justice_home/news/consulting_public/news_consulting_public_en.htm  
http://ec.europa.eu/justice_home/doc_centre/civil/studies/doc_civil_studies_en.htm 
http://ec.europa.eu/dgs/justice_home/evaluation/dg_coordination_evaluation_annexe_en.htm 
http://ec.europa.eu/justice_home/doc_centre/civil/studies/doc_civil_studies_en.htm 
http://ec.europa.eu/civiljustice/publications/docs/enforcement_judicial_decisions_180204_en.pdf 
422 replies were received in total out of which 281 companies filled in the questionnaire completely. 
For the others, the topic was not relevant.  

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results of a study on Civil Justice Systems in Europe conducted in 2008 by the University of 
Oxford11.  

Two major conferences were organised by the Commission, one together with the Heidelberg 
University  and  the  Journal  of  Private  International  law  in  December  2009,  another  one 
together  with  the  Spanish  Presidency  in  March  2010.  These  conferences  have  constituted  a 
large forum of exchange of views with stakeholders on the many different issues raised in the 
revision. 

Finally, a meeting with national experts was held on 20 July 2010. Two meetings with experts 
on the matter of arbitration were held, one on 1 July 2010 and one on [24] September 2010. 

1.5. 

The revision of the Regulation 

The revision of Regulation Brussels I pursues two general objectives. First, it should facilitate 
cross-border litigation and the free circulation of judgments and cut unnecessary red tape in 
line with the principle of mutual recognition. This will make it easier and less time-consuming 
for European citizens and companies to litigate in another Member State if that is required for 
solving  their  disputes.  Second,  the  revision  should  also  help  to  create  the  necessary  legal 
environment  for  the  European  economy  to  recover.  In  order  to  achieve  this,  the  revised 
Regulation should further reduce the cost of litigation and enhance legal certainty for cross-
border transactions.  

In  order  to  achieve  these  objectives,  the  Commission  envisages  to  make  four  main 
amendments to the Regulation:  

•  the abolition of remaining intermediary procedures for the recognition and enforcement of 

judgments, 

•  a  general  improvement  of  access  to  justice  for  European  citizens  and  companies  in 

international disputes, 

•  an enhancement of the effectiveness of choice of court agreements, and 

•  an improvement of the relation between court and arbitral proceedings.  

These  four  amendments  have  important  impacts  and  have  attracted  most  attention  from 
stakeholders. They will therefore constitute the subject matter of this Impact Assessment.12 

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Study  on  Civil  Justice  Systems  in  Europe:  Implications  for  Choice  of  Forum  and  Choice  of  Contract 
Law, 2008, available at http://www.mla.org.mk/webcontent/file_library/ATT04152.pdf 
The external study supporting the preparation of this impact assessment has focussed, among the points 
which will be dealt with in this impact assessment, on the gathering of further data on the operation of 
the Regulation's rule on consumer contract disputes. The Hess report revealed a certain degree of legal 
uncertainty in the application of the existing rule but had not recommended any changes of the rule. The 
results of the external study equally did not support a legislative intervention in the form of a change to 
the existing rule , particularly in the light of two cases before the European Court of Justice which will 
address  concerns  of  legal  certainty.  Nevertheless,  not  dealing  with  the  matter  at  this  stage,  the 
Commission  believes  that  concerns  on  the  operation  of  the  rule  should  be  addressed.  In  this  respect, 
several  actions  are  being  undertaken.  The  Commission's  work  programme  for  2011  foresees  a 
legislative  initiative  on  the  development  of  existing  mechanisms  for  ADR;  the  Communication 
concerning  a  digital  agenda  for  Europe  (COM(2005)  245  final  of  19.5.2010)  provides  for  the 
development  of  an  on-line  dispute  resolution  mechanism  for  e-commerce;  the  abolition  of  exequatur 

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In addition, the revision of Regulation Brussels I will contain a number of other amendments, 
more  of  a  technical  nature,  which  involve  smaller  impacts  and  have  not  received  the  same 
degree of attention from stakeholders. They include, in particular, an improvement of the rule 
which prevents parallel proceedings in Europe. As set out in this report, this rule has mainly 
raised attention in connection with choice of court  agreements (cf. infra). Some issues have 
been  raised  by  a  few  stakeholders  beyond  choice  of  court.  It  stems  from  the  fact  that  the 
courts in some Member States may take a long time to decide on their jurisdiction and from 
the lack of information of the courts on proceedings pending in other Member States. These 
points do not require a substantial change of the rule itself, like in the case of choice of court 
agreements. The operation  of  the  rule may be improved by a few small changes of a  rather 
technical nature. In particular, it may be ensured that a decision on jurisdiction is taken swiftly 
by  the  courts  (by  imposing  a  deadline  to  decide  on  the  jurisdiction  question)  and  that  an 
appropriate communication between the courts involved takes place.  

Another set of amendments will improve access to justice in specific situations. In particular, 
the revision will create a forum for claims of rights in rem at the place where moveable assets 
are  located  and  allow  actions  against  multiple  defendants  in  the  employment  area  to  be 
brought in a single forum under Article 6 (1).  

Finally, the revision will clarify the conditions under which provisional, including protective 
measures can circulate in the EU and improve the coordination of proceedings, in particular 
proceedings on the merits on the one hand and proceedings aimed at obtaining provisional or 
protective  relief  on  the  other  hand.  This  may  be  realised  by  creating  a  communication 
between the courts involved. 

1.6. 

Respect of Fundamental Rights 

With  the  entry  into  force  of  the  Treaty  of  Lisbon  on  1  December  2009,  the  Charter  of 
Fundamental  Rights  of  the  European  Union  ('the  Charter')13  has  become  legally  binding14. 
This means that the EU institutions as well as the Member States when implementing Union 

envisaged in this impact assessment will improve cross-border litigation generally; the future revision 
of  Regulation  861/2007  should  consider  a  possible  increase  of  the  threshold  for  the  use  of  the  small 
claims  procedure,  as  foreseen  in  the  Monti  Report  on  a  new  strategy  for  the  internal  market;  the 
development  of  on-line  judicial  procedures  will  be  further  explored,  in  particular  the  electronic 
processing  of  the  European  order  for  payment  and  small  claims  procedures  and  electronic  forms  of 
mediation  in  the  context  of  the  roadmap  on  e-justice.  The  upcoming  Communication  on  e-commerce 
will address the lack of development of e-commerce, evaluate the impact of the E-commerce Directive 
and encourage the smooth functioning of the internal market for e-commerce, particularly having regard 
to the efficiency of the above-mentioned measures. 

Another  matter  which  has  been  considered  during  the  public  consultation  concerns  the  operation  of  the 
Regulation's  rules  on  industrial  property  disputes.  The  report  and  green  paper  described  certain 
deficiencies  of  the  existing  rules  (e.g.  duplication  of  litigation  in  various  Member  States  and  risk  of 
contradicting judgments despite the fact that the same underlying European patent is the subject matter 
of the litigation) and some possible ways to address these (in particular, e.g., the possibility to allow that 
litigation  in  different  Member  States  are  connected).  The  results  of  the  public  consultation  show  that 
most  stakeholders  prefer  to  await  the  outcome  of  the  discussions  on  the  creation  of  a  unified  patent 
litigation  system  as  this  is  currently  undertaken  at  Union  and  international  level.  The  unified  patent 
litigation  system  would  permit  to  address  patent  litigation  as  a  whole,  going  beyond  the  mere 
jurisdictional questions. The Commission will monitor very closely the developments on this matter and 
re-consider its approach towards patent litigation under the Brussels Regulation, if the ongoing efforts 
to create a unified patent litigation system were not to lead to the warranted result. 
OJ 2010 C 83/02, 389ss. 
Cf Article 6 TEU. 

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law  have  to  respect  the  rights,  observe  the  principles  and  promote  the  application  of  the 
Charter in accordance with their respective powers15. For this reason, all legislative proposals 
put forward by the Commission are subject to a systematic and rigorous monitoring to ensure 
their  compliance  with  the  Charter,  which,  as  set  out  in  the  Strategy  for  the  effective 
implementation of the Charter by the European Union, must serve as compass for the Union's 
policies16. The rights and principles of the Charter which may be affected by the revision of 
Regulation  Brussels  I  vary  depending  on  the  specific  amendment  considered;  the  impact  of 
the different aspects of the reform on these rights and principles is assessed in the following 
chapters. The content of the main provisions concerned is set out below:  

1.6.1.  Right to an effective remedy, Article 47 subparagraph 1 

According to Article 47 subparagraph 1, everyone whose rights and freedoms guaranteed by 
the law of the Union are violated has the right to an effective remedy before a tribunal. This 
provision  is  crucial  to  ensure  access  to  justice  in  the  European  law  context.  The  ECJ  has 
emphasised that the exercise of the rights conferred by EU law must not be rendered ‘virtually 
impossible  or  excessively  difficult’  by  procedural  rules.17  In  line  with  the  case  law  of  the 
European Court of Human Rights, the right to an effective remedy also includes the right of 
the  creditor  to  recover  his  claim  within  a  reasonable  period  of  time  and  on  the  basis  of 
efficient procedures18. 

1.6.2.  Right to a fair trial, Article 47 subparagraph 2 

Article  47  subparagraph  2  stipulates  that  everyone  is  entitled  to  a  fair  and  public  hearing 
within a reasonable time by an independent and impartial tribunal established by law and that 
everyone shall have the possibility of being advised, defended and represented. For disputes 
relating to civil law rights and obligations, this guarantee corresponds to Article 6(1) of the 
ECHR. Inherent in this provision is the right to defence which includes – in the area of civil 
law - the right to be heard and the right to make known its views on the truth and relevance of 
the facts, objections and circumstances put forward by the other party19.  

1.6.3.  Respect for private and family life (Article 7); Protection of personal data (Article 8) 

Freedom of religion (Article 10) 

Article 7 guarantees that everyone has the right to respect for his private and family life, home 
and  communications;  article  10  provides  that  everyone  has  the  right  to  freedom  of  thought, 
conscience and religion. These rights correspond to Articles 8 and 11 of the ECHR. Article 8 
grants persons the right to the protection of personal data concerning them20.  

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Cf. Article 51 (1) of the Charter. 
Communication  from  the  Commission  "Strategy  for  the  effective  implementation  of  the  Charter  of 
Fundamental Rights by the European Union" COM (2010) 573final. 
See e.g. ECJ, Case C-312/93, Pertbroeck v. Belgian State, [1995] ECR I-4599, para. 23. 
See e.g. European Court of Human Rights, 19.3 1997, Hornsby v. Greece, ECHR-Reports 1997 II 495. 
Commentary to the Charter of Fundamental Rights, p. 368. 
This right is based on Article 286 of the TFEU and Directive 95/46/EC on the protection of individuals 
with regard to the processing of personal data as well as on Article 8 of the ECHR and on the Council 
of  Europe  Convention  of 28 January 1981 for  the  Protection of Individuals with regard  to Automatic 
Processing of Personal Data. 

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1.6.4.  Freedom of expression and information (Article 11) 

Article  11  guarantees  that  everyone  has  the  right  to  freedom  of  expression  and  that  the 
freedom and pluralism of the media shall be respected. The exercise of these freedoms may be 
subject  to  conditions  or  restrictions  in  particular  for  the  protection  of  the  reputation  or  the 
rights of others21. 

1.6.5.  Freedom to conduct a business, Article 16 

Article  16  recognises  the  freedom  to  conduct  a  business  in  accordance  with  Union  law  and 
national  laws  and  practices.  This  Article  is  based  on  Court  of  Justice  case-law  which  has 
recognised  freedom  to  exercise  an  economic  or  commercial  activity  and  freedom  of 
contract22,  and  on  Article  119(1)  and  (3)  of  the  TFEU,  which  recognises  free  competition. 
Arguably, these rights encompass that the legal system gives effect to the will of the parties.  

1.6.6.  Consumer Protection, Article 38 

Article 38 of the Charter stipulates that Union policies shall ensure a high level of consumer 
protection. The principle set out in this Article is based on Article 169 of the TFEU. It is also 
reflected in Article 12 TFEU according to which consumer protection requirements have to be 
taken into account in defining and implementing other Union policies and in Article 114 (3) 
TFEU  which  requires  Commission  proposals  to  take  as  a  base  a  high  level  of  consumer 
protection.  

2. 

PROBLEM DEFINITION, OBJECTIVES AND ASSESSMENT OF POLICY OPTIONS 

In the following section, the problems, objectives, policy options and their impact assessment 
will  be  dealt  with  in  separate  subsections  for  each  of  the  four  issues  set  out  above.  This 
approach seems appropriate because each of the four issues has a different problem definition, 
different  policy  objectives,  different  policy  options  and  a  different  group  of  stakeholders 
affected.  An  overview  of  the  stakeholders'  views  on  the  four  main  aspects  of  the  revision 
outlined above is provided  in Annex  II.  Moreover, the four issues are not interconnected in 
the sense that the choice of a policy option on one issue would have an impact on the other 
issues.  For  each  of  the  four  issues,  a  preferred  policy  option  will  be  identified.  The  impact 
assessment  will  conclude  with  an  overall  assessment  of  the  impact  of  the  preferred  policy 
options.  

2.1. 

THE FREE CIRCULATION OF JUDGMENTS 

2.1.1.  Problem definition for the free circulation of judgments  

2.1.1.1.  The current problem 

Traditionally,  a  judgment  given  in  one  Member  State  does  not  automatically  take  effect  in 
another Member State. In order to be enforced in another country, a court in that country first 
has to validate the decision and declare it enforceable. This is done in a special intermediate 

21 
22 

Explanatory Memorandum to the Charter of Fundamental Rights, CONVENT 49. 
Explanatory memorandum to the Charter of Fundamental Rights, CONVENT 49 of 11 October 2000., 
see also judgment in case 151/78 Sukkerfabriken Nykobing (1979), para. 19, and case C-240/97 Spain 
v. Commission (1999), para 99. 

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court  procedure,  known  as  "exequatur"*,  which  takes  place  after  the  judgment  has  been 
obtained and before concrete measures of enforcement can be taken.  

Over the past forty years, obtaining "exequatur" within the European Union has successively 
been  facilitated.  The  1968  Brussels  Convention  harmonised  the  exequatur  procedure  in  the 
then Member States; the 2001 Brussels I Regulation significantly accelerated the process of 
exequatur.  

Despite these efforts, the intermediate exequatur procedure still makes cross-border litigation 
more  cumbersome,  time-consuming  and  costly  than  national  litigation.  Parties  have  to  bear 
court fees for processing the application. Often a lawyer is hired to prepare the documentation 
and handle the procedure abroad. Finally, costs of translation23 and service of documents add 
to the bill. The delay and costs involved in obtaining the recognition and enforcement of cross 
border judgments discourage people from making full use of the possibilities offered to them 
in the internal market by doing business and shopping in other EU countries.  

2.1.1.2.  Who is affected? 

The need to go through exequatur proceedings affects all citizens and companies (whether EU 
or  foreign)  which  need  to  have  a  judgment  given  by  the  courts  of  one  Member  State 
recognized and enforced in another Member State.  

2.1.1.3.  Scope of the problem  

The problem concerns in principle every judgment in civil and commercial matters which is 
given by the courts of one Member State and which needs to be enforced in another Member 
State. Exceptions apply to certain types of judgments (on claims up to € 2,000, uncontested 
claims and claims for family maintenance) for which exequatur has already been abolished by 
recent  EU  legislation  (see  Section  2.1.2  below).  The  number  of  applications  for  recognition 
and enforcement under Regulation Brussels I has been estimated at roughly 10,00024 per year 
in the entire European Union.  

On an EU average, in 93% of the cases, the intermediate step is a pure formality as there are 
no reasons to refuse recognition and enforcement of the foreign judgment25. Between 1 and 
5% of the decisions to grant exequatur are appealed26 but these appeals are rarely successful. 
Only  in  a  handful  of  cases  does  the  procedure  actually  lead  to  a  refusal  of  recognition  and 
enforcement. 

The time for obtaining exequatur varies between the Member States; it can take from a couple 
of days up to several months, depending on the jurisdiction and the complexity of the case. 
This does not take into account the time required for collecting the documents necessary for 

23 

24 
25 
26 

Costs of translations have been calculated on a basis of a 10 page document x €30 per page = €300. The 
proposal aims at reducing these costs by introducing a standard form which will contain only an extract 
of the judgment for purposes of enforcement; only this form will need to be translated.  
CSES report, p. 35.  
CSES report, p. 35  
Cf Hess report p. 21. The difference between 93% and this figure can be explained by the fact that a 
number of applications is refused at first instance because they do not comply with formal requirements 
or fall outside the scope of the Regulation. 

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the application and translations. If an appeal is made, this delay considerably increases: appeal 
proceedings can take up to two years in some Member States27.  

The costs for obtaining exequatur equally vary throughout the EU. For a straightforward case 
of  exequatur,  identifiable  costs  (which  include  court  and  lawyers'  fees,  costs  for  service  of 
documents  and  translations)  range  from  €  1,100   in  Bulgaria  to  almost  €4,000  in  the  United 
Kingdom. On an EU-27 average, € 2,200 has to be paid for pr ocessing the application. This 
amount  can  increase  exponentially  in  a  more  complex  or  contested  case  where  legal  costs 
amount in the EU-27 average to about € 12,700 28. On the assumption that 25% of all cases are 
complex, the overall cost of exequatur proceedings in the EU amounts to almost€48 million 
per year (for details on the number, costs and delays of exequatur proceedings see Annexes 
IV and V).  

The  complexities  of  cross-border  litigation  can  deter  companies  from  doing  business  cross-
border.  Currently,  only  25%  of  European  SMEs  are  engaged  in  cross-border  trade.  The 
possibility of having to pursue litigation abroad is a major concern to business and one of the 
main reasons for not getting involved in cross-border trade29.  

2.1.1.4.  Need for EU action (Subsidiarity) 

The  current  procedure  for  the  recognition  and  enforcement  of  judgments  in  civil  and 
commercial  matters  has  been  established  by  Regulation  Brussels  I,  hence  by  EU  law.  Any 
reform  of  this  procedure  requires  inevitably  the  intervention  of  the  European  legislator  and 
therefore, by definition cannot be achieved by the Member States alone.  

2.1.2.  Objectives 

The specific objective of this part of the Proposal is to achieve a genuine free circulation of 
judgments  in  all  civil  and  commercial  matters.  The  operational  objective  is  to  remove  the 
remaining barriers for such a free circulation of judgments. It should be noted in this context 
that  over  the  past  six  years  the  European  legislator  has  already  abolished  the  exequatur 
procedure  for  certain  types  of  claims,  namely  those  on  small  (up  to  €  2,000)  claims 30, 
uncontested claims31 and – most recently - on claims for family maintenance32. The European 
Council in its Stockholm Programme emphasised that the process of eliminating intermediate 
procedures  (exequatur)  in  the  area  of  civil  law  has  to  continue  and  that  the  abolition  of 
exequatur has to be accompanied by appropriate safeguards. 

2.1.3.  Description of Policy Options 

Policy Option 1: Status quo 

Under this policy option, the existing procedure for recognition and enforcement of judgments 
in civil and commercial matters would continue to exist for judgments concerning an amount 

27 
28 
29 
30 
31 

32 

For details see Annex V. 
For a detailed account of the costs of exequatur in the Member States see Annex IV A. 
CSES study, p. 58. 
Regulation 861/2007 creating a European Small Claims Procedure. 
Regulation 805/2004 establishing a European enforcement order for uncontested claims and Regulation 
1896/2006 creating a European Order for Payment Procedure. 
Regulation  4/2009  on  jurisdiction,  applicable  law,  recognition  and  enforcement  of  decisions  and 
cooperation in matters relating to maintenance obligations. 

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exceeding  2,000  €.  The  defendant *  has  the  possibility  to  contest  the  decision  granting 
recognition  and  enforcement  in  the  Member  State  of  enforcement  in  a  special  procedure 
established by the Regulation and on the grounds enumerated therein33. 

Policy  Option  2:  Maintain  exequatur  and  reduce  the  grounds  for  refusing  recognition  and 
enforcement  

Under this policy option, the free circulation of judgments would not be realised entirely but 
would be facilitated. The existing exequatur procedure would be maintained, but the number 
of grounds which today entitle a Member State to refuse the recognition and enforcement of a 
foreign judgment would be reduced. Currently, the defendant can raise a number of objections 
against the recognition of a foreign judgment. If Option 2 were implemented, some of these 
objections would no longer be available. In particular, the defendant would no longer be able 
to  contest  that  the  court  in  the  Member  State  of  origin  did  not  have  jurisdiction  to  hear  the 
case.  

Policy Option 3: Maintain exequatur but alleviate some of the burden for the applicant  

Under  this  policy  option,  which  could  be  combined  with  Option  2,  the  existing  exequatur 
procedure would be maintained but some of the problems which the current procedure poses 
for  citizens  and  companies  would  be  addressed.  Two  such  problems  are  the  costs  of  the 
exequatur procedure and the need for claimants to go before the courts of the Member State of 
enforcement in order to obtain the declaration of enforceability. The burden of the exequatur 
procedure on the claimant could be alleviated by requiring the Member States to bear he costs 
of  the  procedure.  Member  States  would  have  to  provide  legal  aid  to  a  claimant  seeking  to 
enforce his judgment abroad and/or establish a system of administrative assistance by which 
state authorities would help the claimant in preparing the application which would enable him 
to present it without the need of a lawyer. Moreover, a system of co-operation between courts 
would  be  established  which  would  allow  EU  claimants  to  introduce  the  application  in  their 
own Member State, after which the courts of the Member State of origin would transmit it to 
the Member State where enforcement is sought.  

Policy  Option  4:  Abolish  the  exequatur  procedure,  either  while  introducing  the  necessary 
safeguards for the protection of the right to a fair trial (Option 4A) or without establishing any 
safeguards (Option 4B). 

Under  this  policy  option,  the  free  circulation  of  judgments  would  be  realised  by  removing 
entirely  the  existing  procedure  for  recognition  and  enforcement  of  judgments.  This  option 
could be realised without any safeguards (Option 4B). Under this sub-option, full mutual trust 
is given to judgments in other Member States; no distinction at all is made between foreign 
and  national  judgments.  Alternatively,  it  could  be  analysed  which  existing  grounds  for  the 
refusal of foreign judgments may justifiably lead to a refusal of recognition and enforcement 
of a foreign judgment; any such grounds could be replaced by alternative safeguards (Option 
4A). Three main safeguards could be considered when abolishing the exequatur procedure. A 

33 

According  to  Articles  34  and  35  of  the  Regulation,  there  are  essentially  five  grounds  for  refusing 
recognition of a foreign judgment: (a) if recognition were manifestly contrary to the public policy of the 
state  of  enforcement,  (b)  if  the  defendant  did  not  have  proper  notice  of  the  proceedings,  (c)  if  the 
judgment  is  irreconcilable  with  another  judgment  between  the  same  parties;  (d)  if  it  does  not  respect 
certain  of  the  Regulation's  jurisdiction  rules  (for  consumer  and  insurance  contracts  and  exclusive 
jurisdiction). 

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first  safeguard,  which  already  figures  in  existing  Union  instruments  which  have  abolished 
exequatur34, is the creation of an extraordinary remedy in the Member State of origin for the 
defendant  who  was  not  informed  about  the  proceedings  against  him/her  in  that  State.  A 
second  safeguard,  which  does  not  yet  exist  in  any  Union  instrument,  could  consist  in  the 
creation of a second type of extraordinary remedy in the Member State of enforcement which 
would  permit  to  remedy  any  other  procedural  defects  which  may  have  arisen  during  the 
proceedings before the court of origin and which may have infringed the defendant's rights of 
defence as guaranteed in Article 47 of the EU Charter35. A third safeguard would enable the 
defendant  to  stop  the  enforcement  of  the  judgment  in  case  it  is  irreconcilable  with  another 
judgment  which  has  been  issued  in  the  Member  State  of  enforcement  or  –  provided  that 
certain  conditions  are  fulfilled  -  in  another  country.  These  safeguards  largely  reflect  the 
current grounds under which the recognition and enforcement of a foreign  judgment can be 
refused  today  in  the  context  of  the  exequatur  procedure.  The  only  exceptions  relate  to 
substantive public policy*36 and to the respect, by the court of origin, of certain jurisdiction 
rules. The former ground of refusal no longer seems necessary because to the knowledge of 
the  Commission  there  has  not  been  a  single  case  since  the  entry  into  force  of  the  Brussels 
Convention  where  recognition  and  enforcement  of  a  judgment  has  been  refused  for  this 
reason. The latter ground of refusal does no longer seem adequate in light of the principle of 
mutual trust between Member States.  

During the public consultation, representatives of the media have expressed concerns that the 
abolition  of  exequatur  in  defamation  cases  could  have  a  negative  impact  on  the  freedom  of 
expression. Defamation cases are cases in which an individual claims that rights relating to his 
personality or privacy have been violated by the media. Problems arise from the fact that in 
some  Member  States,  notably  in  the  United  Kingdom,  victims  of  defamation  may  obtain 
particularly  high  damages  which  can  have  serious  impact  for  publishers  and  journalists.  In 
certain Member States, e.g. France, defamation is even a criminal offence. Defamation cases 
are  different  from  other  civil  and  commercial  cases  because  any  court  ruling  allowing  or 
prohibiting  a  certain  publication  has  impact  on  fundamental  rights,  such  as  human  dignity, 
respect  for  private  and  family  life,  protection  of  personal  data,  freedom  of  expression  and 
information.  These  impacts  render  defamation  cases  particularly  sensitive.  The  law  in  this 
area  is  not  harmonised  on  the  European  level.  Member  States'  approaches  to  ensure 
compliance  with  all  the  fundamental  rights  outlined  above  diverge  very  widely.37  These 
differences were recently illustrated by the controversy surrounding the publication of Prophet 
Mohammed  cartoons.  After  a  Danish  court  rejected  a  defamation  case  brought  against  the 
Danish newspaper, claimants who felt harmed by the publication contemplated bringing libel 
proceedings in Britain. In the light of the divergences outlined above, it seems preferable to 
retain the exequatur procedure for decisions in these types of cases in order to allow Member 
States to maintain all existing controls on foreign defamation judgments. 

34 

35 
36 

37 

Regulation  805/2004  establishing  a  European  enforcement  order  for  uncontested  claims,  Regulation 
1896/2006 creating a European Order for Payment Procedure, Regulation 861/2007 creating a European 
Small  Claims  Procedure,  and  Regulation  4/2009  on  jurisdiction,  applicable  law,  recognition  and 
enforcement of decisions and cooperation in matters relating to maintenance obligations. 
see, in particular, Case C-7/98 (Krombach) and Case C-394/07 (Gambazzi). 
Where  there  the  substance  of  the  foreign  judgment  is  at  variance  to  an  unacceptable  degree  with  the 
legal  order  of  the  Member  State  of  enforcement  because  it  infringes  a  fundamental  principle  of  that 
state.  
Cf Final report of the comparative study on the situation in the 27 Member States as regards the law 
applicable  to  non-contractual  obligations  arising  oout  of  violations  of  privacy  and  rights  relating  to 
personality,  carried  out  by  Mainstrat  for 
the  Commission,  JLS/2007/C4/028,  available  at 
http://ec.europa.eu/justice/doc_centre/civil/studies/doc_civil_studies_en.htm. 

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Concerns relating to the abolition of exequatur have also been raised with respect to collective 
redress,  i.e.  proceedings  brought  by  a  group  of  claimants,  a  representative  entity  or  a  body 
acting in the public interest and which concern the compensation of harm caused by unlawful 
business  practices  to  a  multitude  of  claimants.  In  this  area,  the  procedural  law  of  Member 
States  diverges  widely;  in  some  countries,  legislation  on  collective  redress  has  only  been 
introduced very recently, thereby not allowing to fully assess the practical application of these 
rules and their economic effect on foreign companies. It seems therefore preferable to retain 
the exequatur procedure for judgments in collective redress proceedings for the time being to 
maintain all existing controls on foreign judgments in such proceedings.  

2.1.4.  Discarded Policy Options 

Two policy options, option 2 and option 4B can be discarded because they do not constitute 
realistic policy alternatives.  

Option  2  would  not  bring  about  a  palpable  improvement  of  the  current  situation:  as  set  out 
above, an appeal against the decision granting exequatur is only brought in 1% – 5% of the 
cases. A reduction of the grounds of refusal would therefore only improve the situation for a 
very  limited  part  of  the  applications  while  leaving  the  vast  majority  of  cases  completely 
unaffected. Therefore, it will not be considered separately but jointly with policy option 3.  

Option  4B,  the  abolition  of  exequatur without establishing adequate safeguards, has equally 
been discarded because it would have fundamental rights implication in the exceptional case 
where  a  judgment  to  be  recognised  in  another  Member  State  does  not  comply  with 
fundamental rights, such as the right to a fair trial. This option would entirely rely on national 
law  to  ensure  compliance  with  the  right  to  a  fair  trial  or  the  rights  of  defence  without  any 
safeguards for situations where this protection at national level failed. Even if such situations 
are  exceptional,  the  serious  adverse  impact  on  fundamental  rights  in  such  a  case  justifies 
discarding  this  option.  In  addition,  the  majority  of  stakeholders  which  replied  to  the  public 
consultation  on  the  Green  Paper  requested  that  the  abolition  be  accompanied  by  adequate 
safeguards. Option 4B would also go plainly against the conclusions of the European Council 
in December 2009 which emphasised the need of appropriate safeguards for the abolition of 
exequatur. Furthermore, this option would entirely rely on national law to ensure compliance 
with Article 47 of the EU Charter.  

2.1.5.  Analysis of Impacts of Retained Policy Options 

2.1.5.1.  Policy Option 1: Status Quo 

(a) Effectiveness to achieve objectives: Maintaining the status quo would have no effect on 
the  problem  identified  and  would  not  contribute  to  achieving  the  objectives  outlined  above. 
(b)  Key  impacts  (i)  Fundamental  rights:  The  current  exequatur  procedure  adequately 
safeguards fundamental rights as defined in the EU Charter. In particular, the right to a fair 
trial is guaranteed by the possibility to refuse recognition and enforcement of a judgment in 
the  event  of  a  violation  of  public  policy  or  a  lack  of  proper  notice  of  the  proceedings  .  (ii) 
Economic impact38: As to the effect of the status quo on the European economy, while the 
total number of businesses and consumers involved in cross-border litigation and affected by 
the procedure is still relatively small (only about 10,000 cases per year for the entire EU), the 

38 

The  term  "economic  impact"  refers  to  the  costs  or  savings  for  companies  and  citizens  which  the 
respective policy option will bring about. 

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number of exequatur cases is generally increasing39. Moreover, for those who are faced with 
cross-border  litigation,  the  costs  and  delays  in  having  their  judgments  enforced  across  EU 
borders  constitute  a  significant  inconvenience;  the  overall  cost  of  exequatur  proceedings  in 
the EU amounts to almost €48 Mio a year (see  section 2.1.1.3). More importantly, the costs 
and complications of cross-border litigation under the current legal framework are putting-off 
businesses  and  consumers  from  getting  involved  in  cross-border  transactions,  thereby 
preventing them from benefitting from the EU's internal market. The EBTP survey has shown 
that roughly one third of the companies that currently do not sell goods or provide services in 
other  Member  States  have  not  developed  or  stopped  cross-border  business  because  of 
potential  or  actual  cross-border  disputes  and  problems  with  cross-border  debt-recovery40. 
Since SMEs have less resources and infrastructure to deal with cross-border legal proceedings 
than larger companies, they are likely to be particularly affected by the shortcomings of the 
current  situation.  (iv)  Social  impact:  The  status  quo  also  creates  problems  for  employees 
carrying out work in a Member State other than the one where their employer is domiciled if 
they have to enforce a judgment against their employer, e.g. for outstanding wages, abroad.  

2.1.5.2.  Policy  Option  3:  Maintain  exequatur  but  alleviate  some  of  the  burden  for  the 

applicant 

(a) Effectiveness to achieve objectives: Option 3 would go some way towards addressing the 
shortcomings associated with the exequatur procedure while falling short of a total removal of 
the existing barriers to the free circulation of judgments. It would not reduce the costs of the 
existing  exequatur  procedure  but  shift  them  from  the  parties  to  the  Member  States.  Delays 
inherent in the current system would remain. (b) Key impacts (i) Financial costs41: Option 3 
would leave the established procedures at national level largely intact, thereby not requiring 
Member  States  to  introduce  new  judicial  procedures.  However,  Member  States  would  incur 
significant financial costs because they would have to assume the costs currently associated 
with the exequatur procedure: they would have to renounce to current sources of income (e.g. 
by  abolishing  court  fees),  to  compensate  the  applicant  for  costs  incurred  (e.g.  by  granting 
legal  aid)  and/or  to  provide  certain  services  to  the  applicant  (e.g.  by  assisting  the  applicant 
with  the  introduction  of  his  request  which  would  enable  him  to  go  through  the  procedure 
without having to hire a lawyer). It is highly doubtful that Member States would be prepared 
to  assume  this  financial  burden  in  times  of  economic  crisis  and  tight  budgetary  control.  (ii) 
Fundamental  Rights:  The  protection  of  the  rights  of  defence  under  the  current  system 
(outlined above, section 2.1.4.1) would essentially remain untouched. (iii) Economic impact: 
Under  Option  3,  the  current  costs  of  the  exequatur  procedure  would  not  be  diminished;  the 
financial burden would merely be shifted from companies or citizens to the state budgets of 
the Member States. The envisaged reduction of the grounds of refusal and the use of standard 
forms  are  not  likely  to  significantly  reduce  the  legal  costs  associated  with  the  exequatur 
procedure. The elimination of the main obstacles for the applicant would come at a cost for 
Member  States (see above,  point (i)). Although the financial  burden would no longer be  on 

39 

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41 

CSES  study, p.  40. While  there  are  no  reliable  figures  to  evidence  this trend  due  to  poor  statistics  in 
Member States, discussions with various ministries as part of our research generally point to an upward 
trend in the number of applications and this is probably the most reliable guide to the situation across 
the EU as a whole.  
2010 EBTP survey on commercial disputes and cross-border debt recovery: Out of 44.5% of companies 
not involved in cross-border commercial activities; 13.1% replied that this was due to potential or actual 
cross-border disputes or problems with cross-border debt recovery.  
The  term  "financial  costs"  refers  to  the  costs  of  implementing  the  respective  policy  option  in  the 
Member States. 

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the parties but on the general taxpayer, the overall economic impact would remain the same. 
Moreover, it is far from certain that Member States would be prepared to assume these costs 
at  a  time  of  economic  crisis.  Finally,  while  the  companies  already  engaged  in  cross-border 
transactions  would  benefit  from  the  reduction  in  costs  and  complications,  it  is  doubtful 
whether  Option  3  would  have  sufficient  symbolic  effect  to  encourage  those  businesses, 
including  SMEs,  which  currently  do  not  trade  across  borders,  to  do  so.  (iv)  Social  impact: 
Option 3 would improve the situation for employees who are carrying out work in a Member 
State other than the one where their employer is domiciled and who would have to enforce a 
judgment against their employer, e.g. for outstanding wages, abroad.  

2.1.5.3.  Policy Option 4A: Abolition of exequatur with appropriate safeguards 

(a) Effectiveness: This option would have maximum effectiveness: it would fully realize the 
objective of creating a genuine free circulation of judgments in the European Union. (b) Key 
impacts:  (i)  Economic  impact:  The  main  advantage  of  Option  4A  is  that  it  would  fully 
eliminate  the  costs  and  delays  associated  with  the  current  exequatur  procedure  for  the  vast 
majority  (over  90%  of  cases)  in  which  the  enforceability  of  the  foreign  judgment  is  not 
contested  by  the  defendant.  Currently,  the  costs  of  exequatur  proceedings  amount  to  almost 
€48  million  per  year  (see  section  2.1.1.3).  If  exe quatur  were  abolished,  claimants  would  be 
able to save a significant part of this amount. In straightforward cases, the envisaged reform 
would  almost  completely  do  away  with  the  costs  of  the  current  intermediate  proceedings. 
Lawyer  and  court  fees  would  no  longer  be  incurred.  Translation  costs  would  be  minimised 
through  the  use  of  a  standard  form;  the  competent  authority  in  the  Member  State  of 
enforcement would only be entitled to request a translation of an extract of the judgment (max 
one page). In complex cases, claimants would continue to incur legal and translation costs if 
the  enforcement  is  contested  by  the  defendant  in  a  special  review  procedure.  However,  the 
introduction of standard forms should reduce translation costs and lawyers' fees also in these 
circumstances. More importantly, the effect of abolishing exequatur is likely to persuade more 
businesses  and  consumers  to  engage  in  cross-border  trade  than  under  either  Options  1  or  3. 
The increase in businesses' and consumers' confidence in cross-border dealings is likely to be 
particularly  beneficial  for  European  SMEs.  At  present,  only  25%  of  Europe's  20  million 
SMEs  are  engaged  in  cross-border  trade  or  some  other  form  of  cross-border  collaboration. 
This  means  that  15  million  SMEs  could  potentially  expand  their  business  to  other  Member 
States42.  A  survey  has  shown  that  39%  of  these  SMEs  would  be  a  lot  more  inclined  to  get 
involved  in  cross-border  transactions  if  the  exequatur  procedure  were  abolished43.  Even  if 
only  a  quarter  of  the  SMEs  inclined  to  expand  their  business  across  borders  under  these 
conditions actually does, this would bring another 1,4 Million SMEs into the internal market, 
thereby increasing economic growth. (for details see Annex VI). The retention of exequatur 
for defamation cases is unlikely to reduce the positive economic impact of Option 4A because 
the  number  of  these  cases  is  quite  limited  and  the  sector  affected  is  quite  distinct  from 
"ordinary" cross-border business activities. (ii) Fundamental rights: As outlined in Section 
2.1.3  above,  the  abolition  of  exequatur  would  be  accompanied  by  procedural  safeguards 
which  would  ensure  that  a  judgment  in  breach  of  the  right  to  a  fair  trial  and  the  right  of 
defence  cannot  be  recognised  and  enforced.  This  option  would  therefore  comply  with  the 
Charter,  in  particular  its  Article  47.  The  defendant  would  have  three  main  remedies  at  his 
disposal by which he could prevent – in certain circumstances – that a foreign judgment takes 

42 

43 

CSES study p. 60; EIM (Panteia), Internationalisation of European SMEs, Final Report, p. 5, study for 
DG enterprise and Industry, 2010. 
CSES study, p. 59 based on a survey of key stakeholders. 

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effect in a Member State. Since the grounds which could be invoked against the enforcement 
of the foreign judgment largely correspond to those which can be invoked today in the context 
of the exequatur procedure, the level of judicial protection for cross-border proceedings would 
not be lowered compared to the status quo. In addition, exequatur procedure for decision on 
defamation  would  be  maintained  in  order  to  allow  Member  States  to  exercise  all  existing 
controls on foreign defamation judgments and to avoid impacts as regards respect for private 
and family life (Article 7); Protection of personal data (Article 8) and Freedom of expression 
and  information  (Article  11).  (iii)  Financial  costs:  The  introduction  of  new  procedures  in 
Member  States'  national  legal  systems  with  which  legal  professionals,  notably  enforcement 
agents, would need to be familiarized would trigger certain financial costs for Member States. 
However, if national safeguard procedures were modelled on the procedures adopted for the 
European  Enforcement  Order  and  other  European  instruments  which  have  abolished 
exequatur for certain types of claims, the costs of implementing Option 4A would be limited. 
Moreover,  the  proposal  will  contain  a  standard  form  which  aims  at  facilitating  direct 
enforcement.  It  should  also  be  noted  that  costs  for  implementing  the  reform  are  limited  in 
time whereas the economic benefit outlined above would be sustained on a permanent basis. 
(iv)  Social  impact:  Option  4A  would  be  particularly  beneficial  for  weaker  parties.  For 
example, it would improve the situation for employees having to enforce a judgment against 
their employer in another Member State.  

2.1.6.  Comparing the Options and preferred Policy Option 

A comparison of the ratings of the three policy options retained to address the problem of the 
free circulation of judgments shows that the preferred option is Option 4A.  

Objectives/impact 

Policy  Option  1 
– Status quo 

Policy  Option  3 
alleviating 
– 
for 
burdens 
applicant 

Policy  Option 
4A  –  abolition 
of exequatur 

Removal  of  remaining 
free 
to 
barriers 
circulation of judgments 

the 

Economic impact 

Financial costs 

Fundamental rights 

0 

0 

0 

0 

+ 

+  

– 

0 

++ 

+ 

– 

0 

2.2. 

THE  OPERATION  OF  THE  REGULATION  IN  THE  INTERNATIONAL 
LEGAL ORDER  

2.2.1.  Problem  definition  for  the  operation  of  the  Regulation  in  the  international  legal 

order  

2.2.1.1.  The current problems 

Problem 1: With some exceptions, the jurisdiction rules of Regulation Brussels I only apply 
when the defendant is domiciled in the EU. If the defendant is domiciled in a third State, the 

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Regulation  refers  to  national  law  (the  so-called  "residual  jurisdiction"*).  In  other  words, 
Union law regulates only part of the international jurisdiction* of the Member States' courts, 
leaving the remaining part to national law.  

This  limitation  in  the  scope  of  the  Regulation  can  be  explained  by  its  historic  origins  as  an 
international convention. When concluding the Brussels Convention in 1968, Member States 
primarily aimed at protecting defendants domiciled in their respective territories from being 
sued in the courts of other Member State on the basis of grounds of jurisdiction which do not 
guarantee  a  sufficient  connection  with  the  dispute  and  the  application  of  which  is  usually 
limited in bilateral or multilateral conventions on judicial cooperation (so-called "exorbitant 
grounds  of  jurisdiction"*)44.  Under  this  approach,  there  was  no  reason  to  take  into  account 
non-EU defendants; their treatment was therefore left to national law.  

For  the  EU,  the  Convention  and  its  successor,  the  Regulation,  define  certain  grounds  of 
jurisdiction  as  exorbitant45,  by  excluding  their  application  between  Member  States.  For 
instance, the provision in the French code of civil procedure according to which French courts 
always have jurisdiction for an action brought by or against a French citizen has been defined 
as  exorbitant  by  the  Regulation.  However  when  a  defendant  is  domiciled  in  a  third  State, 
those exorbitant grounds of jurisdiction are today applicable.  

National  rules  on  jurisdiction  for  third  country  defendants  vary  widely  between  Member 
States  (for  an  overview  of  national  legislation  on  jurisdiction  concerning  weaker  party 
disputes see Annex VIII, for national exorbitant grounds of jurisdiction see Annex IX). This 
divergence leads to the situation where European citizens and companies have unequal access 
to justice in cases where the defendant is domiciled outside the European Union. Moreover, 
the fact that rules on international jurisdiction are at present laid down in two separate bodies 
of  law,  one  which  applies  where  the  defendant  is  located  in  the  European  Union,  the  other 
where  the  defendant  is  located  outside  the  EU,  adds  to  the  complexity  of  cross-border 
procedures. 

Problem  1A:  This  situation  creates  unequal  conditions  for  companies  doing  business  in  the 
internal market and prevents the creation of the necessary level playing field. Companies from 
Member  States  which  handle  access  to  courts  restrictively  in  disputes  with  third  country 
defendants will usually incur higher business risk and higher legal costs than companies based 
in  Member  States  which  grant  generous  access  to  their  courts  in  these  circumstances.  Not 
being  able  to  litigate  in  a  close  jurisdiction  has  a  negative  economic  impact  on  companies, 
albeit one that is difficult to quantify: claimants are not familiar with the foreign legal system, 
lack access to their known and trusted lawyers and have the inconvenience of travelling and 
wasted management time.  

Moreover,  companies  might  not  always  get  a  fair  trial  and  an  adequate  protection  of  their 
rights before the courts of a third State. Such problems can notably arise in countries where 
the judiciary cannot be considered to be independent or is riven by corruption. 

Example46: An Italian company has engaged in a joint venture agreement in Saudi Arabia. A 
dispute arises which cannot be settled amicably. The Italian company wants to introduce court 
proceedings against the Saudi Arabian joint venture partner. Since its opponent has assets in 

44 
45 
46 

Cf Nuyts report, p. 59 with further references.  
Cf Annex I of Regulation Brussels I. 
This is a real life example reported by an Italian academic.  

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the EU, the company tries to go to court in Europe. However, the rules of the Regulation do 
not apply and under Italian law, no Italian court is competent to hear the case. The company is 
therefore  forced  to  litigate  in  Saudi  Arabia  where  –  due  to  the  lack  of  independence  of  the 
Saudi Arabian courts – it does not get a fair trial.  

A French company in the same situation would have been able to bring the lawsuit in France 
and – assuming the court would uphold the claim – be able to enforce the French judgment 
against the assets of the joint venture partner located within the EU.  

Problem 1B: The current situation is also problematic when weaker parties (e.g. consumers, 
employees or insured) are involved in a dispute with defendants outside the European Union. 
Some  Member  States'  jurisdictions  (e.g.  Austria,  Czech  Republic,  England)  do  not  give  a 
weaker party the possibility to litigate at home in these circumstances47. The obligation to sue 
a  third  country  defendant  abroad  creates  an  additional  burden  for  the  weaker  party  and  is 
likely  to  deprive  him  of  the  protection  granted  by  mandatory  European  legislation.  Such 
legislation protects, in particular, the rights of consumers, commercial agents and victims of 
defective  products.  If  national  law  does  not  grant  the  weaker  party  access  to  the  courts  in 
Europe, he may have no possibility to avail himself of the protection granted to him by Union 
law. This problem is illustrated in the following example:  

Example48: While on holiday in Antalya (Turkey), an English consumer enters into a 
time share agreement with a Turkish company. Under the terms of the contract, the 
Englishman acquires the right to use an apartment situated on the Turkish Riviera for 
a  specific  calendar  week  of  each  year.  As  required  by  the  terms,  he  pays  the  first 
instalment and a deposit when signing the contract. A week later, when reconsidering 
his  financial  situation  after  returning  home,  he  realizes  that  he  cannot  really  afford 
the deal. He decides to withdraw from the contract and  demands  reimbursement  of 
the  money  paid.  Under  the  Time  Share  Directive49,  a  consumer  is  entitled  to 
withdraw from a timeshare contract within the period of 14 days. The Turkish seller 
refuses to reimburse the price. The English consumer wants to assert his rights under 
the Time Share Directive in court. However, under English law, no court in England 
has  jurisdiction  to  hear  the  case.  Since  a  Turkish  court  would  not  be  bound  by  the 
Time  Share  Directive,  the  lack  of  jurisdiction  of  the  English  courts  effectively 
deprives the consumer of the protection which EU law grants to him.  

Again,  a  French  consumer  would  have  been  able  to  sue  "at  home"  and  the  French 
court  would  have  applied  the  Time  Share  Directive.  Even  if  he  was  not  able  to 
enforce  the  French  judgment  in  Turkey,  the  consumer  would  be  able  to  obtain  the 
cancellation of the contract; moreover, where assets of the defendant are located in 
the EU, the judgment can be enforced against those assets.  

Problem 2: At present, Regulation Brussels I only governs the recognition and enforcement of 
judgments  given  by  courts  of  the  Member  States.  The  recognition  and  enforcement  of 

47 
48 

49 

For details see Annex VIII. 
Scenario  inspired  by  ECJ  case  C  73/04  Brigitte  and  Markus  Klein  v.  Rhodos  Management  Ltd  .  A 
summary of relevant judgments of the ECJ may be found in Annex VII. 
Directive 2008/122/EC of the European Parliament and of the Council on the protection of consumers 
in respect of certain aspects of timeshare, long-term holiday product, resale and exchange contracts. 

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judgments rendered by courts outside the European Union is governed by national law. The 
absence of common rules in the EU on the effect of third State judgments leads to a situation 
where  such  judgments  may  enter  the  EU  in  some  Member  States  and  not  in  others.  Some 
Member States are very open to recognise and enforce third State judgments, others are very 
strict, yet others do not recognise and enforce third State judgments at all except in the event 
of a bilateral convention with the third State concerned. This creates unequal protection of EU 
citizens and companies against third State judgments, in particular when the third State court 
has taken jurisdiction on the basis of exorbitant grounds of jurisdiction (see above, Problem 1) 
or on the basis of grounds which violate the exclusive jurisdiction of Member States' courts. It 
may also lead to market distortions.  

2.2.1.2.  Who is affected? 

Those  affected  are  European  citizens  and  companies  involved  in  disputes  with  parties 
domiciled in third States.  

2.2.1.3.  Scope of the problem  

The  extent  of  the  problem  resulting  from  the  existence  of  residual  rules  on  jurisdiction  is 
difficult to quantify. With the exception of Austria, Member States do not maintain statistics 
on  the  number  of  disputes  with  the  parties  domiciled  in  third  States.  Figures  are,  however, 
available  on  the  extent  of  the  divergences  in  the  access  to  EU  courts  for  citizens  and 
companies. For example, six Member States can take jurisdiction to hear a case involving a 
defendant from outside the EU if he was present on their territory at the time of service of the 
claim; 14 (partially identical) Member States consider the presence of the defendant's assets to 
suffice; three consider a cause of action or activities on their territory to suffice. On the other 
hand, nine Member States do not have such "exorbitant" rules on jurisdiction in their national 
law. The situation is similar when it comes to the protection of weaker parties. While in the 
area  of  employment  law,  a  majority  of  18  Member  States  allow  an  employee  to  bring 
proceedings against a non-EU defendant at home, this number is reduced to only 12 Member 
States in the area of consumer law, four Member States in the area of insurance law and only 
three  Member  States  in  the  area  of  commercial  agency  agreements50  (for  details  see  Annex 
VIII).  In  those  Member  States  which  do  not  afford  in  their  national  law  a  jurisdictional 
protection to weaker parties engaged in cross-border transactions with parties outside the EU, 
there  is  clearly  a  risk  that  these  weaker  parties  be  deprived  of  the  substantive  protection 
provided by EU legislation51. Objectives 

The  specific  objective  is  to  improve  access  to  justice,  legal  certainty,  and  protection  of  EU 
citizens and companies in disputes connected with third States. The operational objective is to 
ensure equal access to justice in the EU and make sure that weaker parties are not deprived of 
the protection granted to them by EU law.  

2.2.2.  Need for EU action (Subsidiarity) 

Under  the principle of subsidiarity  laid down in Article 5  TFEU, in  areas  which do not fall 
within its exclusive competence, the Union shall act only if and in so far as the objectives of 
the proposed action cannot be sufficiently achieved by the  Member States but can be better 
achieved at Union level. The existence of unequal conditions for companies doing business in 

50 
51 

Nuyts Study on residual jurisdiction, p. 43, 46, 48 and 49 respectively. 
Cf Nuyts Study on residual jurisdiction, p. 86 es. 

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the internal market cannot be adequately addressed by action at Member State level because 
the present problem is caused by the diversity of national legislation and reform by individual 
Member States will not remedy the situation. The possibility to take a coordinated approach 
and resolve the problem by way of multilateral or bilateral conventions is no longer available 
to the Member States because external competence in matters of international jurisdiction lies 
exclusively  with  the  European  Union,  as  the  Court  of  Justice  has  clarified  in  its  Lugano 
Opinion 1/0352. The protection of weaker parties could theoretically be achieved at national 
level  but  Member  States  have  not  addressed  the  issue  so  far  and  there  is  no  indication  that 
they would if the Union refrained from legislating. In addition, since mandatory Union law is 
at stake, the  Union should  take  appropriate action  to  ensure  enforcement  of  Union  law.  For 
these  reasons,  the  objectives  set  out  above  could  be  better  achieved  at  EU  level.  Moreover, 
action  at  EU  level  would  have  the  benefit  of  simplifying  the  current  legal  framework  by 
consolidating all rules on international jurisdiction into a single legal document.  

2.2.3.  Description of Policy Options 

Five policy options have been identified to address the problems outlined above.  

Policy Option 1: Status quo  

If  the  status  quo  were  maintained,  unequal  access  to  justice  resulting  also  in  some  unequal 
costs  to  bear  would  continue  to  exist  as  a  result  of  diverging  national  laws  governing 
jurisdiction  vis-à-vis  third  State  defendants  as  well  as  recognition  and  enforcement  of  third 
State judgments.  

Policy Option 2: International negotiations 

Under this policy option, the Commission would seek to negotiate an international agreement 
which would establish common rules on jurisdiction and the recognition and enforcement of 
judgments on an international level. Such an agreement would notably ensure that countries 
only take jurisdiction on the basis of internationally accepted criteria. Negotiations could take 
place  in  the  framework  of  an  international  organisation  such  as  the  Hague  Conference  on 
Private  International  Law*.  This  option  could  be  pursued  on  a  self-standing  basis  or  in 
combination with Options 3, 4 or 5.  

Policy Option 3: Minimum harmonisation  

Under  this  option,  only  a  few  rules  relating  to  disputes  involving  third  country  defendants 
would  be  harmonised  while  the  remainder  would  continue  to  be  governed  by  national  law. 
This  option  could  cover  only  the  rules  on  jurisdiction  (Option  3A)  or  both,  the  rules  on 
jurisdiction  and 
those  on  recognition  and  enforcement  (Option  3B).  A  minimum 
harmonisation of the rules on jurisdiction would focus on disputes involving "weaker parties" 
(consumers, insured, employees). It would extend the current rules of the Regulation, which 
allow these parties to sue "at home" in intra-EU disputes, to defendants domiciled outside the 
EU.  Member  States  would  be  allowed  to  maintain  national  rules  on  jurisdiction  in  all  other 
cases  involving  third  country  defendants.  A  minimum  harmonisation  of  rules  on  the 
recognition and enforcement of third country judgments would provide a minimum protection 

52 

Opinion 1/03 of 7 February 2006 on the competence of the Community to conclude the new Lugano 
Convention  on  jurisdiction  and  the  recognitin  and  enforcement  of  judgments  in  civil  and  commercial 
matters.  

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from third country judgments which do not comply with EU standards. Member States would, 
however, be permitted to maintain national rules which establish more restrictive conditions 
for the recognition and enforcement of non-EU judgments than the minimum rules.  

Policy  Option  4:  Full  harmonisation  of  both  the  rules  on  jurisdiction  and  recognition  and 
enforcement  

This  policy  option  would  fully  harmonise  the  rules  relating  to  disputes  with  third  State 
defendants at EU level. As with Option 3, this option can be divided into two suboptions: a 
full  harmonisation  of  the  rules  on  jurisdiction  only  (Option  4A)  or  a  full  harmonisation  of 
both  the  rules  on  jurisdiction  and  on  the  recognition  and  enforcement  of  third  country 
judgments  (Option  4B).  The  full  harmonisation  of  jurisdiction  rules  would  require  the 
extension  of  all  existing  grounds  of  jurisdiction  in  Regulation  Brussels  I  to  defendants 
domiciled outside the EU. This means that not only the protective fora discussed in Option 3 
but also the grounds on jurisdiction applying for disputes in matters of contract or tort would 
be  extended  to  apply  to  third  country  defendants.  Moreover,  an  additional  ground  of 
jurisdiction  would  be  created  which  would  grant  EU  parties,  both  weaker  parties  and 
companies, access to EU courts in case no other court would have jurisdiction to hear the case 
or  the  EU  party  would  not  get  a  fair  trial  in  the  third  country  court  (so-called  "forum 
necessitatis"*).  In  addition,  national  "residual"  grounds  of  jurisdiction,  i.e.  would  be 
abolished, thereby creating a level playing field in the EU when it comes to access to justice. 
In  order  to  compensate  for  the  abolition  of  national  grounds  of  jurisdiction,  an  additional, 
"mildly exorbitant" forum would be established which grants jurisdiction to the court of the 
Member  State  where  assets  of  the  defendant  are  situated.  This  forum  would  have  the 
advantage of granting jurisdiction at the place where usually the judgment can be enforced.  

Under  Option  4B,  the  grounds  for  refusing  the  recognition  and  enforcement  of  a  judgment 
issued in a non-EU country would be fully harmonised by the Regulation.  

2.2.4.  Discarded policy options 

Policy  options  2,  3B  and  4B  can  be  discarded  from  the  further  analysis  for  the  following 
reasons:  

The  harmonisation  of  the  rules  on  recognition  and  enforcement,  whether  minimal  or  full 
(Options  3B  and  4B)  has  not  received  sufficient  support  from  stakeholders  in  the  public 
consultation. Few stakeholders were in favour of the idea to establish EU rules on recognition 
and  enforcement;  all  others  expressing  a  view  on  the  issue  preferred  the  issue  to  remain 
governed by national law or international conventions. Overall, stakeholders seem to be more 
concerned that the issue in question risks overburdening the revision of the Regulation than 
with  the  protection  of  EU  citizens  and  companies  from  third  country  judgments.  As  to  the 
Member  States,  while  many  agree  that  an  extension  of  the  jurisdiction  rules  to  cover  third 
State defendants would be an improvement of the current situation, most are very reluctant as 
to a harmonisation of the regime of recognition and enforcement. It would therefore not make 
political sense to pursue these options further at this stage.  

By  contrast,  Option  2,  i.e.  the  approach  to  address  the  current  problems  through  the 
negotiation of an international instrument, has received significant support from stakeholders 
in  the  public  consultation.  The  option  has  nevertheless  been  discarded  in  its  pure  form,  i.e. 
without being combined with either Option 3A or 4A, because it does not seem to be realistic 
that  agreement  on  a  multilateral  convention  on  this  issue  could  be  reached  in  the  short  or 

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medium  term.  Efforts  of  negotiating  a  worldwide  convention  on  jurisdiction  and  the 
recognition and enforcement of judgments in civil matters (the "judgment convention") have 
been  undertaken  by  the  Hague  Conference  on  Private  International  Law  for  almost  twenty 
years  without  producing  viable  results.  In  1999,  the  project  of  a  judgments  convention 
dramatically  failed  after  years  of  intense  negotiations.  Over  the  past  ten  years,  the  Hague 
Conference has repeatedly tried to re-launch the project, most recently at its general meeting 
in  April  2010,  but  without  avail.  Although  the  EU  supported  the  idea,  the  majority  of 
delegations, including the USA, Canada, Japan and Australia, were opposed to resume even 
exploratory work on this matter for the time being. Hence, while the EU should continue its 
efforts to re-launch negotiations on this issue, it is highly unlikely that a convention could be 
agreed in a foreseeable future and the ratification process could easily take another decade.  

2.2.5.  Analysis of impact of retained policy options 

2.2.5.1.  Policy Option 1: Status quo 

(a)  Effectiveness  to  achieve  objectives:  This  option  would  not  meet  the  objectives  set  out 
above  of  ensuring  access  to  justice  and  guaranteeing  protection  from  third  state  judgments. 
(b) Key impacts. (i) Economic impact. The key argument for retaining the status quo is that 
there is little quantitative evidence that the existing divergences between the national laws of 
Member States lead to distortions of competition and that the absence of access to EU courts 
entails significant losses for consumers and other weaker parties. However, the mere fact that 
the problem is difficult to quantify does not mean that it does not exist. (ii) Financial costs: 
Fundamental rights. The status quo can lead to situations where EU citizens and companies 
do not have adequate access to justice or would not benefit from a fair trial in the competent 
court. While the mere fact that an EU claimant has to litigate outside the EU does not as such 
constitute a denial of justice, situations can arise where the competent foreign court does not 
guarantee certain procedural standards, is not independent, is corrupt or for other reasons does 
not  respect  the  parties'  right  to  a  fair  trial.  Moreover,  the  status  quo  does  not  guarantee  an 
effective remedy before a tribunal in cases where rights of weaker parties granted by EU law 
are  infringed.  (iii)  Social  impact.  Under  the  status  quo,  consumers,  employees  and  other 
weaker parties would not always be able to avail themselves of the rights granted to them in 
mandatory EU legislation. This lack of adequate protection will make weaker parties reluctant 
to  engage  in  transactions  with  parties  in  non-EU  countries.  (iv)  Third  countries.  The 
existence  of  exorbitant  grounds  of  jurisdiction  in  a  number  of  Member  States  could  be  a 
problem  for  non-EU  countries  which  might  be  drawn  before  EU  courts  even  if  the  case  in 
question  does  not  have  a  sufficient  link  with  the  EU  territory.  Exorbitant  grounds  of 
jurisdiction  are  generally  critised  at  international  level.  The  most  recent  attempt  to  reach 
international  agreement  on  reducing  such  exorbitant  fora  in  the  context  of  the  Hague 
judgments Convention has however failed.  

2.2.5.2.  Policy Option 3A: Minimum harmonisation of the rules on jurisdiction 

(a)  Effectiveness  to  achieve  objectives:  Option  3  would  achieve  part  of  the  objectives 
indicated above. It would ensure adequate access to EU courts for weaker parties involved in 
disputes  with  defendants  domiciled  outside  the  EU.  However,  inequalities  in  the  access  to 
justice within the EU would remain. (b) Key impact (i) Economic impact Option 3 would 
remove the burden for weaker parties resulting from litigation before the courts of a non-EU 
State, in particular in those Member States where no access to the courts is currently foreseen 
under  national  law.  On  the  other  hand,  Option  3  would  not  remedy  the  absence  of  a  level 
playing  field  caused  by  the  current  divergence  of  national  rules  because  the  divergence  of 

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national  rules  on  jurisdiction  would  remain.  This  means  that  companies  in  some  Member 
States will continue to incur higher business risk and litigation costs than companies in other 
Member States. (ii) Financial costs: Option 3A would trigger minimal to no financial costs 
for  the  Member  States.  (iii)  Fundamental  rights  and  social  impact:  Option  3A  would 
improve  the  current  situation  in  terms  of  fundamental  rights  for  weaker  parties,  both  as 
regards  Article  47  and  Article  38  of  the  EU  Charter.  It  would  clearly  strengthen  access  to 
justice  in  the  EU  for  consumers,  employees,  insured  and  other  weaker  parties  involved  in 
litigation with third country defendants by ensuring the enforcement of the rights granted to 
them by EU legislation. The situation that a weaker party would effectively be deprived from 
the  protection  afforded  to  him  by  EU  legislation  because  no  court  in  the  EU  would  be 
competent to hear the case would no longer arise. However, Option 3 would not remedy the 
risk  of  a  denial  of  justice  which  European  companies  might  encounter  under  the  present 
system, i.e. the situation that no court or only a court where the company cannot expect a fair 
trial  would  be  competent  to  hear  the  case.  (iv)  Third  countries:  Option  3  would  not  have 
significant impact on third countries because the extension of the Regulation's protective rules 
of jurisdiction to situations where the weaker party is litigating against a defendant outside the 
EU would presumably not be perceived as unduly extending jurisdiction  

2.2.5.3.  Policy Option 4A: Full harmonisation of the rules on jurisdiction  

(a)  Effectiveness  to  achieve  objectives:  The  full  harmonisation  of  jurisdiction  rules  would 
achieve the desired objective of ensuring both full and equal access to justice to the European 
courts.  Access  to  justice  would  also  be  fully  transparent  because  all  rules  on  international 
jurisdiction  would  be  consolidated  in  one  single  document,  the  revised  Regulation.  This 
option would do away with the artificial distinction between defendants domiciled within the 
EU and outside the EU. Such a distinction is no longer made in recent EU legislation, notably 
the  Regulation  4/2009  on  maintenance  obligations53  and  the  Commission  proposal  for  a 
regulation  on  succession  and  wills.54  (b)  Key  impact:  (i)  Economic  impact:  The  full 
extension of the Regulation's rules on jurisdiction to third country defendants would increase 
the possibilities for EU companies to litigate in the EU rather than abroad. This would bring 
about  a  reduction  in  the  average  litigation  costs  and  delays  for  EU  companies  because 
litigation within the European area of justice is generally cheaper and simpler than litigation 
in a country outside the EU55. Measures of judicial cooperation are largely absent in relations 
with  third  countries  and  the  geographical  distance  of  the  competent  court  will  most  likely 
increase costs for witnesses and parties to appear in person. Moreover, a harmonisation of the 
rules relating to third country defendants will increase legal certainty and predictability which, 
in  turn,  is  likely  to  produce  cost  savings  for  the  companies  involved.  The  improved  legal 
framework might also encourage more companies to engage in cross-border transactions. In 
addition,  the  absence  of  a  level  playing  field  which  results  from  the  divergence  of  national 
rules  on  jurisdiction  would  be  remedied.  SMEs:  Any  cost  savings  will  be  particularly 
beneficial  for  SMEs  which  do  not  have  the  resources  to  handle  complex  international 
litigation in the same way as large companies. (ii) Financial costs: Option 3A would trigger 
minimal  to  no  financial  costs  for  the  Member  States.  (iii)  Fundamental  rights  and  social 
impact: As for Option 3A, the full harmonisation would improve access to justice for weaker 
parties (consumers, employees etc) in line with Articles 38 and 47 of the Charter because it 
would guarantee their access to an EU court in disputes involving defendants from outside the 

53 

54 
55 

Council  Regulation  (EC)  No  4/2009  on  jurisdiction,  applicable  law,  recognition  and  enforcement  of 
decisions and cooperation in matters relating to maintenance obligations. OJ L 7, 10.1.2009. 
COM (2009) 154 final of 14 October 2009. 
See CSES study, p. XXX (figures to follow). 

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   EN 

                                                 
EU.  In  addition,  Option  4A  would  ensure  full  access  to  justice  to  European  companies  in 
litigation  involving  third  country  defendants.  The  creation  of  a  forum  of  necessity  would 
ensure  that  European  companies  would  have  access  to  an  EU  court  in  case  no  other  court 
guaranteeing  a  fair  trial  has  jurisdiction.  Finally,  the  introduction  of  a  forum  geared 
specifically at non-EU defendants would improve access to justice for companies from those 
Member States which currently do not have comparable provisions in their national law. (iii) 
Social  impact  As  Option  3A,  Option  4A  would  ensure  that  weaker  parties  (consumers, 
employees  etc.)  retain  the  protection  granted  to  them  by  mandatory  EU  law.  (iv)  Third 
countries The impact of Option 4A on non-EU countries would depend on the substance of 
the harmonised jurisdiction rules. If the EU were to include several strongly exorbitant fora in 
the revised Regulation, the reform may be badly perceived on a diplomatic level. However, 
the envisaged creation of a forum of necessity and a "mildly exorbitant" rule of jurisdiction, 
e.g. based on the location of assets provided that the case has a sufficient link with the forum, 
is  hardly  objectionable  on  a  diplomatic  level  given  that  the  procedural  rules  of  most  of  the 
EU's  trading  partners  contain  themselves  exorbitant  rules  of  jurisdiction.  On  the  contrary, 
impact  on  third  countries  would  be  positive  as  Member  States  would  not  be  entitled  to 
maintain  more  generous  conditions  for  access  to  justice  in  their  national  law.  Should 
international  negotiations  on  a  worldwide  judgments  convention  resume,  the  impact  of  the 
revision  on  the  EU's  negotiating  position  would  equally  depend  on  the  substance  of  the 
harmonised rules. The alignment of national rules as such would be neutral in this respect and 
the  introduction  of  a  "mildly  exorbitant"  forum  in  the  Regulation  could  improve  the  EU's 
bargaining position in the negotiations.  

2.2.6.  Comparing the options and preferred policy option 

Based  on  the  above  analysis,  the  key  elements  of  which  are  summarized  in  Table  2,  the 
preferred Policy Option is Option 4A.  

Objectives/impact 

Policy Option 1 

Policy Option 3A 

Policy Option 4A 

Improve protection of 
EU  parties  in  extra-
EU disputes  

Economic impact 

Fundamental rights 

Impact 
countries 

on 

third 

0 

0 

0 

0 

+ 

0 

+ 

0 

++ 

+ 

+ 

0 or + 

2.3. 

CHOICE OF COURT AGREEMENTS 

2.3.1.  Problem definition for the Choice of Court Agreements  

2.3.1.1.  The current problem  

Choice  of  court  agreements  (also  known  as  "forum-selection-clauses")  are  one  of  the  most 
important jurisdictional devices of modern times. They are contractual clauses by which the 
parties  determine  which  court  should  decide  any  dispute  which  might  arise  between  them. 

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Choice of court agreements enable businesses (and others) to plan where potential litigation 
will  take  place;  the  effectiveness of  choice  of  court  agreements  increases  legal  certainty  for 
companies.  

Regulation Brussels I gives effect to choice of court agreements, provided they comply with 
certain  formal  requirements.  The  possibility  of  the  parties  to  choose  the  competent  court  is 
only  excluded  in  specified  cases  where  there  is  likely  to  be  an  inequality  of  bargaining 
power56 or where there are strong policy reasons why particular courts should have exclusive 
jurisdiction57. 

Problem  1:  Concerns  have  been  raised  that  the  effectiveness  of  choice  of  court  agreements 
may in practice suffer from abusive litigation tactics. This is possible due to an interplay with 
another provision in the Regulation, the so-called lis pendens* rule58. This rule aims to avoid 
the  situation  that  two  courts  in  the  EU  deal  with  the  same  case  at  the  same  time  with 
potentially conflicting  outcomes.  It  stipulates that the court second seized of a dispute must 
stay proceedings until the court first seized has ruled on its jurisdiction. Where the court first 
seised is not the chosen court, it should decline jurisdiction unless the agreement is invalid.  

While  the  lis  pendens  rule  is  sound  in  theory,  it  may  encourage  abusive  litigation  tactics  in 
practice.  This  is  because  a  party  can  gain  important  advantages  if  it  violates  the  choice  of 
court agreement and sues in another jurisdiction than the chosen one. First, the court actually 
seized might consider the agreement invalid while the chosen court would have upheld it. The 
court seised might also consider that the question in dispute is not covered by the choice of 
court  agreement  whereas  the  court  chosen  is  known  to  give  a  broader  interpretation  to  the 
scope  of  jurisdiction  clauses.  Thirdly,  the  party  wishing  to  escape  the  choice  of  court 
agreement can considerably delay proceedings in the chosen court if the court first seised is 
situated  in  a  country  whose  judicial  system  is  notoriously  slow.  In  legal  literature,  this 
technique has come to be known as the "Italian torpedo"59. Depending on the jurisdiction and 
the  complexity  of  the  case,  it  will  take  the  non-competent  court  from  several  months  to 
several  years  to  decline  jurisdiction.  This  delay,  which  adds  to  the  time  for  obtaining  a 
judgment  on  the  merits  can  be  extremely  vexing  for  companies  seeking  to  swiftly  recover 
their  debts.  Moreover,  torpedo  actions  increase  the  costs  of  litigation  by  adding  court  and 
lawyers' fees in the non-competent jurisdiction to the overall bill.  

The problem described above can be illustrated by the Gasser60 case which was decided by 
the Court of Justice in 200361 and has sparked the call for reforming the Regulation's rules on 
choice of court agreements: 

Example: Company X, established in Austria, concludes a sales contract with 

56 
57 
58 
59 

60 
61 

E.g. in relation to consumers, employees and insured.  
E.g. concerning rights in rem in immovable property, cf. Article 22 of the Regulation. 
Article 27. 
This  expression  was  actually  coined by  an Italian  lawyer specialised  in intellectual  property  law who 
advised companies wishing to infringe a patent to bring a declaratory action for non-liability in Italy. 
Their action may fail in the end but it is likely to take years to decide during which they could make use 
of the patent without interference; cf. Franzosi, "Worldwide Patent Litigation and the Italian Torpedo" 
(2977)  7  EIPRev,  p.  382.  In  one  such  case,  it  took  eight  years  for  a  non-competent  court  to  decline 
jurisdiction, cf the judgment of the ECJ in case C- 159/97 Trasporti Castelletti v. Trumpy. 
A summary of relevant judgments of the ECJ may be found in Annex VII. 
Judgment of the ECJ of 9th December 2003 in case C-116/02 Gasser GmbH v. MISRAT Srl. The facts of 
the case have been simplified to illustrate the point discussed.  

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28 

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company  Y,  established  in  Italy.  The  contract  contains  a  clause  whereby  the 
parties  agree  to  bring  any  disputes  under  the  contract  before  the  courts  in 
Vienna,  Austria.  Company  Y  defaults  on  its  performance  under  the  contract. 
Before company X can bring an action for damages, company Y launches court 
proceedings  in  Rome,  Italy,  requesting  that  the  contract  be  declared  null  and 
void. When company X brings an action for damages in Vienna on the basis of 
the  choice  of  court  agreement,  arguing  that  the  agreement  is  valid,  the 
Viennese court is unable to proceed due to the lis pendens rule and has to wait 
until the court in Rome has declined jurisdiction.  

Problem  2:  The  effectiveness  of  choice  of  court  agreements  needs  to  be  ensured  not  only 
within  the  European  Union  but  also  beyond  the  EU's  borders.  European  companies  doing 
business worldwide will not always be able to impose the choice of their home jurisdiction on 
their  trading  partner;  they  will  often  have  to  agree  to  litigate  in  a  court  situated  outside  the 
EU. In these circumstances, it is equally important for the companies that the choice made by 
the parties will be upheld in case a dispute arises. However, the current divergence of national 
laws on the question of choice of court agreement makes it difficult for businesses to foresee 
if and under which conditions their jurisdiction clause will be respected. In order to remedy 
this  situation,  the  European  Union  negotiated  an  international  agreement,  the  Hague 
Convention  on  Choice  of  Court  Agreements*,  which  improves  legal  certainty  for  forum-
selection-clauses in B2B relationships. The convention was adopted in 2005 and signed by the 
EU in 2009. The ratification process is ongoing and closely followed by the EU's main trading 
partners  such  as  the  US.  The  ratification  of  the  Convention  would  have  an  impact  on  the 
Regulation  because  choice  of  court  agreements  between  an  EU  party  and  a  non-EU  party 
would  no longer be governed by the Regulation but by the Convention.  The  revision  of  the 
Brussels I Regulation does not seek to implement the Convention's rules; this is not necessary 
given  that  the  Convention  once  ratified  will  be  directly  applicable  in  all  Member  States. 
However, the revision should ensure that the approach to choice of court agreements for intra-
EU  situations  is  coherent  with  the  one  which  will  potentially  be  adopted  for  extra-EU 
situations  .  Under  the  Hague  Convention,  the  court  seised  but  not  chosen  must  dismiss  the 
case unless one of the exceptions established by the Convention applies62. 

2.3.1.2.  Who is affected? 

Although  choice  of  court  agreements  can  be  concluded  by  anyone  entering  into  a  contract, 
they  are  primarily  relevant  for  companies  involved  in  cross-border  trade,  whether  with 
partners domiciled within or outside the European Union.  

2.3.1.3.  Scope of the problem  

Almost  70%  of  European  companies  engaged  which  sell  products  or  provide  services  in 
another Member State have choice of court agreements in their international contracts63. The 
larger  the  company,  the  more  likely  that  it  makes  use  of  this  jurisdictional  device:  90%  of 
companies  having  more  than  250  employees  use  choice  of  court  agreements  regularly  or 
occasionally64. These figures show that the overwhelming majority of EU business makes use 
of  choice  of  court  agreements  in  their  B2B  relations  and  is  interested  to  minimise  the 
possibilities  of  abusive  litigation  tactics  which  could  thwart  their  effectiveness  and  force 

62 
63 
64 

Cf Article 6 of the Convention. 
EBTP survey, question 3. 
Oxford study on civil judicial systems in Europe, question 48, 49. 

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29 

   EN 

                                                 
companies  to  litigate  in  a  court  other  than  the  one  contemplated  or  to  engage  in  costly  and 
time-consuming  parallel  litigation.  Choice  of  court  agreements  also  figure  increasingly  in 
transnational  company  agreements  concluded  between  employees'  representatives  and  the 
management65.  

It is difficult to obtain reliable figures which would quantify the risk of abuse of the existing 
rules. According to one survey, 7.7% of companies reported that in the past five years their 
contractual  counterpart  did  not  comply  with  the  clause  designating  the  competent  court  and 
took the dispute before a different court66; almost half of these companies faced this problem 
more  than  once.  5.7%  of  companies  stated  that  their  choice  of  court  agreement  was  held 
invalid  over  the  same  period67.  It  is  not  clear  which  percentage  of  these  companies  was 
affected by abusive litigation tactics but it can be inferred from the figures that this concerns 
between 2 and 7.7% of all companies.  

2.3.2.  Objectives  

The  specific  objective  is  to  enhance  the  effectiveness  of  choice  of  court  agreements  and 
facilitate the ratification by the European Union of the Hague Convention on Choice of Court 
Agreements.  The  operational  objectives  are  to  eliminate  possibilities  for  abusive  procedural 
tactics  in  a  way  which  makes  the  rules  of  the  Regulation  compatible  with  the  Hague 
Convention. 

2.3.3.  Need for EU action (Subsidiarity) 

The  rules  governing  lis  pendens  between  two  or  more  courts  seised  with  a  dispute  in  the 
Member  States  are  laid  down  in  Regulation  Brussels  I,  an  instrument  of  EU  law.  Any 
modification  of  these  rules  for  disputes  involving  choice  of  court  agreements  requires 
inevitably  the  intervention  of  the  European  legislator  and  therefore,  by  definition  cannot  be 
achieved by the Member States alone.  

2.3.4.  Description of policy options 

Policy Option 1: Status quo 

Under  this  option,  the  effectiveness  of  choice  of  court  agreements  would  continue  to  suffer 
from abusive litigation tactics and the solution adopted by the Regulation would not be in line 
with the one promoted by the Hague Convention.  

Policy Option 2: Exempt the chosen court from obligation to stay proceedings  

Under this option, the court designated in a choice of court agreement would be released from 
its  obligation  to  stay  proceedings  pending  the  decision  of  the  court  first  seised.  As  a 
consequence,  both  the  chosen  court  and  the  court  first  seised  would  be  allowed  to  continue 
their proceedings in parallel.  

65 

66 
67 

to 

See on this issue the 2009 study by van Hoek/Hendricks, International private law aspects and dispute 
settlement  related 
the  very  bottom  of 
transnational  company  agreements,  available  at 
http://ec.europa.eu/social/main.jsp?catId=707&langId=en&intPageId=214  
EBTP survey, question 7. 
EBTP survey, question 4; given that the number of companies answering questions 7 and 4 is identical, 
it can be presumed that the companies refer to the same cases.  

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30 

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Policy Option 3: Give the chosen court priority to decide on its jurisdiction 

Under this option, the court chosen in a choice of court agreement would be given priority to 
proceed and decide on its jurisdiction, regardless of whether it is first or second seised. Any 
other court would have to stay proceedings until the chosen court has established or – in case 
the choice of court agreement is invalid – declined its jurisdiction.  

Policy Option 4: Impose a deadline on the court first seised to decide on its jurisdiction 

Under this option, the chosen court would continue having to stay proceedings until the court 
first seised has declined its jurisdiction but the Regulation would oblige the court first seised 
to take its decision within a certain deadline. In addition, the two courts would communicate 
in the course of the proceedings with a view to facilitating the resolution of the jurisdiction 
question.  

Policy Option 5: Exclude actions for negative declaratory relief from the lis pendens rule 

Under  this  option,  the  general  rule  that  the  court  second  seised  has  to  stay  proceedings 
pending the decision of the court first seised would remain. However, an exception would be 
made for cases where the first court has only been seised with an action for declaratory relief. 
These are actions where the claimant does not request the payment of a sum of money or the 
performance  of  the  contract  but seeks  a  ruling  on  the  validity  of  a  contractual  clause  or  the 
existence of a specific obligation. Thus, a claimant trying to evade a claim for damages in the 
chosen court could seek a declaration from another court that he is not liable to pay damages 
(so-called  "negative  declaratory  relief").  Under  Option  5,  the  chosen  court  which  is  seised 
second  could  continue  with  its  proceedings  in  situations  where  the  action  in  the  court  first 
seised was limited to declaratory relief.  

2.3.5.  Discarded policy options 

Two  policy  options,  option  4  and  option  5  have  been  discarded  following  the  public 
consultation because they did not receive sufficient support by stakeholders.  

As to Option 4 (Imposing a deadline on the court first seised and establishing a mechanism of 
direct  communication  between  the  courts)  many  stakeholders  considered  that  this  option 
could  be  a  useful  additional  measure  to  improve  the  functioning  of  the  lis  pendens  rule 
generally  but  that  it  would  not  by  itself  achieve  the  desired  objective  of  discouraging  the 
circumvention of choice of court agreements. Setting a deadline would be helpful to speed up 
proceedings in some countries where the judicial system is very slow but would not as such 
discourage  abusive  litigation  in  a  non-competent  court.  Costs  and  delays  would  still  be 
incurred,  even  if  the  time  frame  became  more  predictable. This option will therefore not be 
considered  separately  in  this  context.  It  will  be  considered  as  an  amendment  to  the  general 
functioning  of  the  lis  pendens  rule  which,  however,  goes  beyond  the  scope  of  this  analysis 
(see point 1.5 above).  

Option  5  (the  exclusion  of  negative  declaratory  relief  from  the  lis  pendens  rule)  did  not 
receive substantial support by stakeholders. First, it tackles only part of the problem outlined 
above.  While  actions  seeking  a  declaration  of  non-liability  might  be  one  way  to  frustrate  a 
choice of court agreement, they are certainly not the only way. In many circumstances, a party 
wishing  to  torpedo  a  choice  of  court  agreement  could  also  bring  an  action  seeking 
performance  and/or  requesting  the  payment  of  damages.  This  option  would  therefore  not 
entirely  remove  the  threat  to  choice  of  court  agreements  resulting  from  pre-emptive 

EN 

31 

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proceedings.  Stakeholders  also  pointed  out  that  this  option  would  not  be  in  line  with  the 
solution adopted by the Hague Choice of Court Convention. It was therefore decided not to 
pursue it further.  

2.3.6.  Analysis of impacts of retained options 

2.3.6.1.  Policy Option 1: Status quo 

(a) Effectiveness to achieve objectives: This option would not meet the objectives outlined 
above.  The  status  quo  would  continue  jeopardising  the  effectiveness  of  choice  of  court 
agreements and would not bring about the legal certainty necessary to encourage businesses to 
engage in cross-border transactions. (b) Key impacts: (i) Economic impact: Choice of court 
agreements are widely used by European businesses; more than 70% of EU companies uses 
this  judicial  device  in  their  international  contracts  (see  Section  2.3.1.3  above).  The  current 
situation  is  heavily  criticised  by  stakeholders  which  emphasise  the  imminent  need  to 
strengthen  the  effectiveness  of  choice  of  court  agreements.  The  actual  damage  caused  by 
abusive litigation tactics today is difficult to quantify; the proportion of companies affected by 
the shortcomings of the current situation in the past five years is between 2 and 7.7%. Where 
a company becomes a victim of abusive litigation tactics, it incurs costs and delays to defend 
its case in a jurisdiction other than the one chosen before being able to litigate in the chosen 
court.  The costs  incurred  consist  notably  of lawyers' fees  and travel expenses,  possibly also 
costs of the translation of documents or of expert witnesses68. More importantly, the risk of 
having  the  resolution  of  their  disputes  complicated  in  the  way  outlined  above  is  putting  off 
European  companies  from  getting  involved  in  cross-border  transactions,  thereby  preventing 
them to make full use of the advantages offered to them by the internal market. As set out in 
Section 2.1.5.1 above, about 30% of the companies that currently do not sell goods or provide 
services in other Member States are not doing so because of potential or actual problems in 
litigation  or  debt-recovery69.  Since  SMEs  have  fewer  resources  and 
cross-border 
infrastructure  to  deal  with  cross-border  legal  proceedings,  the  deterring  effect  of  the  status 
quo is likely to be larger on them than on big multinationals. (ii) Fundamental rights: The 
fact that the status quo does not fully ensure the effectiveness of choice of court agreements 
could have a negative impact on the freedom to conduct a business referred to in Article 16 of 
the  Charter,  which  encompasses  the  freedom  of  contract.  Arguably,  these  rights  encompass 
that the legal system gives effect to the will of the parties. Where a choice of court agreement 
is validly concluded, parties should not be able to escape from it by bringing an action in a 
different court. The current situation which encourages abusive litigation tactis of that kind is 
problematic  in  that  respect.  (iii)  International  aspects:  Maintaining  the  status  quo  would 
mean that the regime applied under the Regulation to internal situations would differ from the 
regime  applied  to  external  situations  under  the  Hague  Convention  on  Choice  of  Court 
agreements.  

2.3.6.2.  Policy Option 2: Exempt the chosen court from the obligation to stay proceedings 

(a) Effectiveness to achieve objectives: This option would achieve the desired objective of 
discouraging abusive litigation tactics because pre-emptive actions in another court would no 
longer  delay  proceedings  in  the  chosen  forum.  However,  a  bad  faith  claimant  could  still 

68 

69 

It will depend on the procedural rules of the forum to what extent these costs can be recovered from the 
losing  party  in  case  the  court  not  chosen  upholds  the  choice  of  court  agreement.  These  rules  vary 
significantly between Member States.  
EBTP survey, question 1. 

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complicate the life of his (business) partner by first seising a court not chosen by the parties 
and  forcing  the  other  party  to  engage  in  parallel  litigation.  In  the  cases  where  the  court  not 
chosen  decided  that  the  jurisdiction  clause  was  invalid,  option  2  would  entail  the  risk  of 
conflicting  judgments  which  the  rules  of  the  Regulation  generally  seek  to  avoid.  (b)  Key 
impacts:  (i)  Economic  impact:  Option  2  would  have  some  economic  benefits  because  it 
would limit the risk of abusive litigation and thereby limit the damage caused at present by 
the  abuse.  However,  option  2  would  create  the  risk  of  cost  and  time-consuming  parallel 
litigation and conflicting judgments which today does not exist. It would therefore not go far 
enough to encourage those businesses which currently are not engaged in cross-border trade 
to do so . On the basis that over the past five years, 7.7% of companies have faced a situation 
where their contractual counterpart did not respect the choice of court agreement and brought 
proceedings  in  a  different  court,  the  risk  of  parallel  proceedings  and  conflicting  outcomes 
would affect 1.5% of companies per year70. (ii) Financial costs: Financial costs incurred for 
implementing  the  change  would  be  minimal  given  that  no  new  procedures  would  be 
introduced.  (iii)  Fundamental  rights:  By  allowing  the  chosen  court  to  proceed,  option  2 
would  give  better  effect  to  the  will  of  the  parties  having  concluded  a  choice  of  court 
agreement than option 1. However, the risk of costly and time-consuming parallel litigation 
would  remain.  Option  2  would  therefore  only  slightly  improve  the  situation  in  terms  of  the 
freedom  to  conduct  a  business  referred  to  in  Article  16  of  the  Charter.  (iv)  International 
aspects:  This  option  mirrors  to  a  certain  extent  the  approach  adopted  by  the  Hague 
Convention. The rule that chosen court would be able to proceed even if it is seised second 
corresponds  to  the  situation  which  would  apply  to  choice  of  court  agreements  in  favour  of 
courts outside the EU once the Hague Convention is ratified by the EU.  

2.3.6.3.  Policy Option 3: Give the chosen court priority to decide on its jurisdiction  

(a)  Effectiveness  to  achieve  objectives:  Giving  jurisdictional  priority  to  the  chosen  court 
would  discourage  the  use  of  tactical  pre-emptive  claims  which  seek  to  undermine  a  valid 
choice  of  court  agreement.  Option  3  would  thus  fully  achieve  the  objectives  set  out  above 
without  entailing  the  risk  of  parallel  proceedings  as  does  option  2.  (b)  Key  impacts:  (i) 
Economic  impact:  Option  3  would  eliminate  the  costs  and  delays  which  businesses  incur 
today due to their partners' bad faith attempts to circumvent choice of court agreements. It is 
also  likely  to  encourage  at  least  part  of  the  30%  of  businesses  which  currently  are  not 
involved in cross-border trade because of problems inherent in cross-border litigation or debt-
recovery to do so. It would increase legal certainty for businesses and boost their confidence 
in the effectiveness of their contractual arrangements for dispute resolution. The drawback of 
this solution is that it may lead to delays in judicial proceedings where the designated court 
eventually  holds  the  agreement  invalid  and  the  parties  end  up  litigating  in  another  court. 
However, the percentage of choice of court agreements which is declared invalid is relatively 
small:  it  concerns  only  about  1.1%  of  companies  per  year71.  Arguably,  fewer  companies 
would be affected by the disadvantages of option 3 than those affected by the drawbacks of 
option  2.  (ii)  Financial  costs:  As  option  2,  option  3  would  be  a  clear  and  straightforward 
solution to address the identified problem  which would  only entail minimal implementation 
costs. (iii) Fundamental rights: By minimizing the room for abusive litigation tactics, option 
3 would fully give effect to the will of the parties to a choice of court agreement. This would 
improve the situation of the parties in terms of the freedom to conduct a business as referred 

70 

71 

Cf  EBTP  survey,  question  4  and  6,  according  to  which  over  a  five  year  period,  7.7%  of  companies 
faced  a  situation  where  their  choice  of  court  clause  was  not  respected  by  the  other  party  and 
proceedings were brought in a different court.  
Cf EBTP survey, question 4. 

EN 

33 

   EN 

                                                 
to  in  Article  16  of  the  Charter.  (iv)  International  aspects:  Option  3  mirrors  the  solution 
adopted by the Hague Convention. As in the Convention, priority is given to the chosen court 
which  is  able  to  proceed  even  if  seised  second.  In  the  public  consultations,  this  option  was 
therefore supported by many stakeholders.  

2.3.7.  Comparing the options and preferred Policy Option 

On the basis of the analysis set out above, which is summarized in the table below, Option 3 
is the preferred policy option.  

Objectives/impact 

Policy  Option 
Status quo 

1

Policy  Option 
Exemption 
obligation 
proceedings 

to 

2
from 
stay 

Policy  Option 
3
Giving priority to the 
chosen court 

Eliminate 
the 
possibilities for abuse

Economic impact 

Fundamental rights 

0 

0 

0 

+ 

+ 

+ 

++ 

++ 

++ 

International aspects 

0 

+ 

++ 

2.4. 

INTERFACE BETWEEN THE REGULATION AND ARBITRATION  

2.4.1.  Problem definition for the interface between the Regulation and Arbitration  

2.4.1.1.  The current problems 

Arbitration  is  a  matter  of  great  importance  in  international  commerce.  It  is  a  way  for 
companies  to  resolve  their  disputes  out-of-court  which  has  certain  advantages  over  court 
litigation, notably in terms of confidentiality, speed and informality of proceedings72.  

Arbitration is currently not covered by the scope of Regulation Brussels I. The exclusion of 
arbitration  can  be  explained  by  the  existence  of  the  1958  New  York  Convention  on  the 
Recognition and Enforcement of Foreign Arbitral Awards* which requires the courts of the 
Contracting  States  to  give  effect  to  a  private  agreement  to  arbitrate  and  to  recognize  and 
enforce an arbitral award made in another Contracting State. All Member States are party to 
this Convention and it is also widely ratified throughout the rest of the world.  

While  in  general  the  arbitration  exclusion  of  the  Regulation  has  allowed  arbitration  in  the 
Member  States  to  develop  on  the  basis  of  the  New  York  Convention  and  national  law, 
difficulties have been reported concerning the relation of arbitration and court proceedings. In 
fact, there are situations in which state courts may be requested to intervene in disputes which 
have been submitted to arbitration. For instance, courts may be seized to grant interim relief*, 
to  assist  in  setting  the  arbitration  in  motion  or  to  evaluate  the  validity  of  an  arbitration 

72 

Cf. Oxford Study on Civil Justice Systems in Europe, Fn. XX above, question 49. 

EN 

34 

   EN 

 
                                                 
agreement.  In  the  latter  case,  the  party  challenging  the  validity  of  the  arbitration  agreement 
will usually request the court to decide also on the merits of the case. This can lead to parallel 
proceedings  and  irreconcilable  decisions  between  courts  and  arbitral  tribunals  where  the 
agreement is held invalid in one Member State and valid in another.  

This problem was recently illustrated in the West Tankers73 case. The parties to a commercial 
contract  had  agreed  to  arbitration  in  London;  nevertheless  an  action  for  damages  was 
introduced in the Italian courts (where the damage had occurred), based on the argument that 
the  arbitration  agreement  was  invalid.  The  question  arose  whether  the  Italian  proceedings 
were covered by the scope of Regulation Brussels I. The Court of Justice held that if a party to 
an arbitration agreement introduced court proceedings on the merits in which the invalidity of 
the arbitration clause was raised as an preliminary question, such proceedings fall within the 
scope  of  Regulation  Brussels  I.  This  means  that  the  subsequent  judgment  circulates  freely 
within the EU under the Regulation and can prevent the continuation of arbitral proceedings 
on the same issue or the later recognition and enforcement of the arbitral award. This situation 
creates  an  incentive  for  a  party  wishing  to  escape  from  an  arbitration  agreement  to  claim 
(possibly in bad faith) that the agreement is invalid and to bring proceedings on the merits in a 
Member State where it is likely to obtain a favourable decision.  

The  West  Tankers  decision  thus  revealed  a  real  risk  for  abusive  litigation  tactics  under  the 
Regulation.  The  fact  that  a  bad  faith  claimant  can  escape  from  an  arbitration  agreement  by 
bringing  an  action  on  the  merits  in  a  "friendly"  jurisdiction  jeopardizes  the  effectiveness  of 
arbitration in the European Union. The current situation may encourage parties to arbitrate in 
countries outside the EU which provide more legal certainty for arbitral proceedings, thereby 
undermining the attractiveness of arbitration within the European Union.  

2.4.1.2.  Who is affected? 

The main stakeholders concerned are large European companies which opt for arbitration to 
resolve disputes with their commercial counterparts and European arbitration centres.  

2.4.1.3.  Scope of the problem  

The  current  legal  framework  does  not  sufficiently  protect  the  effectiveness  of  arbitration 
agreements in the EU. It entails a risk of parallel court and arbitration proceedings which are 
not only costly and time-consuming for the companies concerned but also create the risk of 
conflicting outcomes. The reactions received in the public consultation and examples of cases 
discussed in legal literature clearly show that the problem exists, although its exact extent is 
difficult to quantify notably due to the confidentiality of arbitral proceedings. 

The effectiveness of arbitration is of key importance for a significant number of notably larger 
companies and multinationals which use this method of dispute resolution on a regular basis. 
Surveys show that about 63% of large European companies prefer arbitration over litigation to 
resolve  their  business  disputes;  this  is  mainly  due  to  the  confidentiality  and  speed  of 
arbitration proceedings74. Where they have a choice, European companies prefer to arbitrate 
within  the  EU:  their  most  popular  seats  of  arbitration  are  London  and  Paris,  followed  by 

73 
74 

Case C-185/07. A summary of relevant judgments of the ECJ may be found in Annex VII. 
Oxford Study on Civil Justice Systems in Europe, question 48, 49; 95% of the companies questioned 
have more than 250 employees.  

EN 

35 

   EN 

                                                 
Geneva,  Stockholm  and  New  York75.  The  attractiveness  of  arbitration  in  Europe  is  also 
important for European arbitration centres which assist the parties with the arbitration process, 
e.g.  choosing  the  arbitrators,  organising  the  hearings  and  finalising  the  award  and  which 
charge  fees  for  these  services.  In  2009,  European  arbitration  centres  administered  4,453 
international  arbitration  cases  with  a  total  value  of  over  €  50  billion;  the  tendency  is 
growing76. Judging by the value of the claim (and leaving apart sector-specific centres such as 
the London Maritime Lawyers' Association), the most important arbitration centre in the EU 
is  the  International  Chamber  of  Commerce  in  Paris,  followed  by  the  London  Court  of 
International  Arbitration77.  But  also  smaller  centres  such  as  the  Vienna  International 
Arbitration Centre, the Netherlands Arbitration Institute, the German DIS and the Stockholm 
Chamber of Commerce make important contributions to the European arbitration industry78. 
The  total  value  of  the  arbitration  industry  in  the  European  Union  can  be  estimated  at  €4 
billion79.  The  European  arbitration  industry  faces  increasing  competition  from  emerging 
arbitration centres in Asia. Notably, the Singapore International Arbitration Centre is one of 
the fastest growing arbitral institutions, having increased its case-load by over 300% over the 
past 9 years and currently handling the fifth largest number of cases worldwide80. Objectives  

The  specific  objective  is  to  ensure  a  transparent  and  predictable  coordination  of  court  and 
arbitral proceedings which preserves and improves the attractiveness of the European Union 
as  place  of  arbitration.  The  operational  objective  is  to  avoid  parallel  court  and  arbitration 
proceedings  and  to  reduce  the  possibilities  of  undermining  arbitration  proceedings  through 
abusive litigation tactics.  

2.4.2.  Need for EU action (Subsidiarity) 

The  problems  described  above  are  caused  by  the  delimitation  of  the  scope  of  Regulation 
Brussels  I,  as  interpreted  by  the  case-law  of  the  Court  of  Justice.  Any  modification  to  the 
scope of the Regulation, whether extending or limiting it, therefore requires the intervention 
of the European legislator and, by definition cannot be achieved by the Member States alone.  

2.4.3.  Description of policy options 

Policy Option 1: Status quo  

If the status quo were maintained, arbitration would generally remain excluded from the scope 
of the Regulation. However, in light of the case law of the European Court of Justice, court 
proceedings on the merits of the case and in which the validity of the arbitration agreement is 
raised as a preliminary question would be covered by the Regulation, thus allowing parallel 
proceedings,  possibly  conflicting  outcomes  of  the  dispute  and  enabling  a  party  seeking  to 
escape from an arbitral agreement to "sabotage" the arbitral proceedings.  

Policy Option 2: Extend the exclusion of arbitration from the scope  

Under this policy option, the exclusion of arbitration from the scope of Regulation Brussels I 
would be extended to cover not only arbitration proceedings but also any court proceedings 

75 
76 
77 
78 
79 
80 

CSES study, p. 90, 91. 
CSES study, p. 86. 
CSES study, p 88. 
CSES study, p. 90, 91. 
CSES study, p. 88.  
CSES study, p. 89. 

EN 

36 

   EN 

                                                 
related to arbitration proceedings, notably proceedings in which the validity of an arbitration 
agreement is contested. The recognition and enforcement of a subsequent judgment would not 
be governed by the Regulation but by national law.  

Policy Option 3: Enhance the effectiveness of arbitration agreements  

This option would enhance the effectiveness of arbitration agreements by including common 
rules  for  certain  aspects  of  arbitration  in  Regulation  Brussels  I.  Essentially,  a  rule  on  lis 
pendens  would  be  inserted  into  the  Regulation  which  provides  that  a  court  seised  with  a 
dispute  involving  an  arbitration  agreement  would  have  to  stay  proceedings  if  a  court  at  the 
seat  of  the  arbitration  or  an  arbitral  tribunal  is  seised  with  the  question  of  the  existence, 
validity or effects of the arbitration agreement. As a result, it would always be possible for the 
parties to an arbitration agreement to ensure that only the arbitral tribunal or the court at the 
seat of the arbitration is hearing the case. This would prevent parallel proceedings and the use 
of tactical litigation manoeuvres to "sabotage" arbitration proceedings as outlined above. This 
element could be implemented on its own (Option 3A) or in combination with an improved 
system  for  the  recognition  and  enforcement  of  arbitral  awards  which  would  go  beyond  the 
1958  New  York  Convention  (Option  3B).  Such  a  system  could  be  limited  to  establishing  a 
uniform procedure for recognition and enforcement, similar to the existing exequatur system 
for  court  judgments,  while  retaining  the  grounds  of  refusal  of  the  1958  New  York 
Convention,  or  it  could  restrict  the  grounds  for  refusal  beyond  those  in  the  New  York 
Convention  and  also  deal  with  situations  of  irreconcilable  court  judgments  and  arbitral 
awards.  

2.4.4.  Discarded Policy Options 

Following the public consultation, Option 3B was discarded because there was little support 
for it. Stakeholders generally feel that the 1958 New York Convention works satisfactorily for 
the  recognition  and  enforcement  of  foreign  arbitral  awards  and  that  there  is  no  need  to 
regulate  this  issue  on  the  European  level.  It  would  therefore  not  make  sense  to  pursue  this 
option further.  

2.4.5.  Analysis of impacts of retained Policy Options 

2.4.5.1.  Policy Option 1: Status quo 

(a) Effectiveness to achieve objectives: Maintaining the status quo would not contribute to 
the  objectives  outlined  above.  Businesses  which  have  opted  for  arbitration  in  one  country 
would continue to run the risk that the arbitration agreement is set aside by a court of another, 
possibly less "arbitration-friendly" country. (b) Key impact: (i) Economic impact: Although 
the total number of arbitration cases in the EU is relatively modest, the average value of these 
cases is very high (more than € 1 mio per cas e). Where such significant amounts of money are 
at stake, businesses need to be sure that their choice of the dispute resolution method cannot 
be  jeopardized  by  their  opponent's  abusive  litigation  tactics.  In  particular,  the  potential 
consequences of the West Tankers decision are perceived as very negative by the arbitration 
community;  stakeholders  emphasize  the  need  for  reform81.  Given  that  the  West  Tankers 
decision is a fairly recent one, there is not yet hard evidence pointing to EU arbitration centres 
losing out to non-EU ones but there is a concern that this is beginning to happen82. If business 

81 
82 

CSES study, p. 105. 
CSES study, p. 105. 

EN 

37 

   EN 

                                                 
moves  away  from  arbitration  in  Europe,  the  European  arbitration  industry  risks  losing  a 
significant  part  of  its  current  €4  bio  value.  Moreover,  thos e  European  companies  which 
currently  go  for  arbitration  in  the  EU  would  need  to  incur  lawyers'  costs  for  adapting  their 
dispute  resolution  strategies.  (ii)  Fundamental  Rights:  The  risk  of  parallel  proceedings 
between  courts  and  arbitral  tribunals  and  of  "sabotage"  of  the  arbitral  proceedings  would 
subsist.  This  situation  could  have  negative  impact  for  the  efficiency  of  justice  and  for  the 
freedom to conduct a business because it does not ensure that appropriate effect is given to the 
will of the parties. (iii) Third countries: Today, European arbitration centres attract not only 
European  companies  but  also  companies  from  outside  the  EU.  If  the  legal  framework  for 
arbitration  becomes  less  attractive  following  the  West  Tankers  decision,  non-EU  companies 
would re-orientate their dispute resolution to arbitration centres outside the EU.  

2.4.5.2.  Policy Option 2: Extend the exclusion of arbitration from the scope 

(a)  Effectiveness  to  achieve  objectives:  This  option  would  partially  achieve  the  objectives 
outlined above. Doubts over the effectiveness of agreements to arbitrate in the EU would be 
removed and businesses within the EU would be able to arbitrate without the threat of costly 
delaying tactics against them. However, the general problem of parallel court and arbitration 
proceedings and risk of conflicting decisions would remain. Moreover, the total exclusion of 
all  judgments  in  cases  involving  an  arbitration  agreement  from  the  scope  of  the  Regulation 
would  enable  cynical  litigants  to  "torpedo"  the  recognition  and  enforcement  of  a  judgment 
simply  by  claiming  that  the  parties  have  concluded  an  arbitration  agreement.  Furthermore, 
option  2  would  go  against  the  overall  objective  of  creating  a  genuine  area  of  justice  in  the 
European Union because it would re-nationalise part of the rules which are today harmonised 
on  the  European  level.  Judgments  which  currently  circulate  under  Regulation  Brussels  I 
would cease to do so; their recognition and enforcement in another Member State would again 
be  governed  by  the  national  laws  of  the  27  Member  States.  This  would  constitute  a  step 
backwards  in  the  creation  of  a  European  area  of  civil  justice  which  should  be  avoided.  (b) 
Key  impact:  (i)  Economic  impact:  Essentially,  the  risks  linked  to  the  possibilities  for 
abusive  litigation  tactics  which  have  been  illustrated  by  the  West  Tankers  decision  will  be 
eliminated. However, the risk of parallel court and arbitration proceedings would continue to 
exist.  Arbitration  in  the  EU  would  be  more  attractive  for  European  companies  than  under 
Option 1. Equally, the attractiveness of arbitration centres in Europe would be better ensured 
than under Option 1, although the deficiencies in the current legal framework may still make 
them  less  attractive  than  certain  competitors  outside  the  EU  (ii)  Financial  costs:  Costs  for 
implementing  the  modification  would  be  minimal.  (iii)  Fundamental  Rights:  Under  this 
Option,  the  question  whether  a  court  can  hear  a  case  in  which  an  arbitration  agreement  has 
been  concluded  would  depend  entirely  on  national  law.  The  risk  of  parallel  proceedings 
would  therefore  subsist  with  the  negative  impact  for  the  efficiency  of  justice  and  for  the 
freedom  to  conduct  a  business  outlined  above.  The  attractiveness  of  arbitration  in  the 
European Union would be consolidated. 

2.4.5.3.  Policy Option 3A: Enhance the effectiveness of arbitration agreements  

(a) Effectiveness to achieve objectives: This policy option would fully achieve the objectives 
outlined above. It would ensure the effectiveness of arbitration agreements by eliminating the 
risk  of  parallel  proceedings  and  by  reducing  the  possibilities  of  abusive  litigation  tactics.  It 
would also ensure that all judgments that currently circulate within the EU continue to do so. 
(b) Key impact: (i) Economic impact: As in Option 2, Option 3A would eliminate the risk of 
abusive litigation tactics, with the economic benefits outlined above. In addition, Option 3A 
would  eliminate  the  risk  of  parallel  court  and  arbitration  proceedings,  thereby  significantly 

EN 

38 

   EN 

improving the attractiveness of arbitration in the EU and of European arbitration centres. The 
European arbitration industry would be able to maintain their current business or expand it. 
(ii)  Financial  costs:  As  for  Option  2,  the  modification  of  the  Regulation  would  entail  only 
minimal  implementation  costs  for  Member  States.  (iii)  Fundamental  Rights:  This  option 
would improve the effectiveness of the remedy before a tribunal (article 47 of the Charter) for 
companies  wishing  to  challenge  (in  good  faith)  an  arbitration  agreement  because  it  would 
establish  a  clear  and  transparent  legal  framework  for  such  challenges  while  defining  clear 
rules  to  improve  legal  certainty  and  avoiding  dilatory  tactics.  It  would  also  contribute  to 
ensure  that  throughout  the  Union,  maximum  effect  is  given  to  the  will  of  the  parties  which 
enhances their freedom to contract and freedom to conduct a business as referred to in Article 
16  of  the  Charter.  (iv)  Third  countries:  It  may  be  expected  that  the  attractiveness  of 
arbitration in the European Union would be increased. 

2.4.6.  Comparing options and preferred Policy Option 

Based  on  the  above  analysis,  which  is  summarized  in  the  table  below,  the  preferred  policy 
option is option 3A.  

Objective/impact 

Option 1 
Status quo 

Option 2 
Extending the 
exclusion 

Option 3 
Enhancing the 
effectiveness 

Avoid 
proceedings 
conflicting decisions 

parallel 
and 

Ensuring  effectiveness  of 
arbitration in EU 

Economic impact 

Fundamental rights 

0 

0 

0 

0 

– 

+ 

+ 

+ 

+ 

++ 

+ 

++ 

3. 

OVERALL EVALUATION OF IMPACT OF PREFERRED POLICY OPTIONS  

3.1. 

Summary of the preferred policy options 

The preferred policy options for the revision of Regulation Brussels I can be summarized as 
follows: 

(1) 

(2) 

The  existing  exequatur  procedure  would  be  abolished,  thereby  permitting 
judgments  to  freely  circulate  within  the  European  Union.  The  rights  of  the 
defendant would be safeguarded by introducing review procedures necessary 
to ensure the right to a fair trial. 

The  existing  rules  on  jurisdiction  of  the  Regulation  would  be  extended  to 
apply  to  defendants  domiciled  outside  the  EU;  moreover,  some  additional 
fora  would  be  added  which  would  only  apply  to  third  country  defendants. 
Jurisdiction  for  third  country  defendants  would  be  fully  governed  by  the 

EN 

39 

   EN 

 
(3) 

(4) 

regulation  but  the  recognition  and  enforcement  of  third  country  judgments 
would continue to be governed by national law.  

The effectiveness of choice of court agreements in favour of EU courts would 
be  increased  by  reducing  the  possibilities  of  abusive  litigation.  The  chosen 
court would get priority to decide the case even if another court is seised first 
of the dispute.  

Arbitration agreements would also be made more effective. Any other court 
whose jurisdiction is contested on the basis of the existence of an arbitration 
agreement  would  have  to  suspend  proceedings  on  the  matter  insofar  as  the 
question  of  the  existence,  validity,  or  effects  of  the  agreement  is  brought 
before  the  courts  of  the  seat  of  the  arbitration  in  the  Union  or  before  an 
arbitral tribunal. This will reduce the risk of parallel proceedings and abusive 
litigation tactics by parties seeking to evade an arbitration clause.  

3.2. 

The preferred options' effectiveness to achieve the policy objectives 

As indicated in the assessment of the individual policy options, the preferred options address 
the problems identified better than any of the other options. Taken as a whole, they facilitate 
cross-border  litigation  and  ensure  a  genuinely  free  circulation  of  judgments  based  on  the 
principle  of  mutual  recognition  and  improve  respect  of  fundamental  rights.  They  also  help 
create the necessary legal environment for the European economy to recover by reducing the 
cost of litigation and enhancing legal certainty for cross-border transactions.  

More specifically, the package of preferred policy options will 

•  remove  the  remaining  barriers  for  the  free  circulation  of  judgments  while  maintaining  a 

high standard of protection of the rights of defence;  

•  ensure  equal  access  to  justice  as  well  as  the  conditions  for  a  fair  trial  for  citizens  and 
companies in the European Union and make sure that weaker parties are not deprived of 
the protection granted to them by European law; 

•  enhance the effectiveness of choice of court agreements concluded in favour of European 

courts by reducing to a maximum the possibilities for abusive litigation tactics. 

•  Avoid  parallel  court  and  arbitration  proceedings  and  reduce  the  possibilities  of 

circumventing arbitration agreements by abusive litigation tactics.  

3.3. 

Economic impact  

The  package  of  policy  options  would  lead  to  significant  savings  for  European  companies 
currently  engaged  in  cross-border  business.  The  abolition  of  exequatur  would  allow  these 
companies to save the major part of the current costs of the intermediate procedure of almost 
€48  Mio  per  year.  .  Also  the  new  rules  on  jurisdiction  will  bring  about  a  reduction  in  the 
average litigation costs and delays for EU companies because litigation within the European 
area of justice is generally cheaper and simpler than litigation in a country outside the EU. In 
addition, the preferred policy options would contribute to preserving the current value of the 
European arbitration industry of € 4 billion pe r year and possibly increase it. Moreover, the 
reform  would  encourage  an  estimated  39  %  (5,8  million)  SMEs  which  are  currently  not 
involved in cross-border transactions to make full use of the benefits offered to them by the 

EN 

40 

   EN 

internal  market  and  give  more  confidence  to  more  than  50%  of  the  consumers  which  are 
currently  discouraged  or  entirely  discouraged  from  engaging  in  cross-border  commerce 
because of the costs and delays associated with enforcing their rights in another country.  

3.4. 

Impact on financial costs 

Taken as a whole, the reform package would trigger  relatively  modest financial costs. Only 
the  abolition  of  exequatur  would  require  Member  States  to  incur  costs  for  training  to 
familiarize  the  legal  profession  with  the  new  procedures  envisaged  to  safeguard  the 
defendant's rights. However, if national safeguard procedures are modelled on the procedures 
adopted for the existing European instruments which already have abolished exequatur for the 
judgments  falling  within  their  scope,  the  costs  for  implementing  the  reform  should  be 
minimal.  In  addition,  judicial  intermediaries,  notably  those  in  charge  of  the  actual 
enforcement,  would  need  procedural  guidance  and  training  to  be  able  to  handle  the 
enforcement  of  judgments  from  another  Member  State  in  the  absence  of  a  validation  by  a 
national  court.  The  other  changes  envisaged  constitute  relatively  straightforward  changes  to 
existing rules which would not require the creation of new procedures and should be able to 
be applied by judicial intermediaries without the need of special training.  

3.5. 

Impact on fundamental rights 

All elements of the reform package respect to the rights set out in the Charter of Fundamental 
rights, and in particular the right to an effective remedy and the right to a fair trial guaranteed 
in its Article 47. They also improve the level of consumer protection referred to in Article 38. 
The abolition of exequatur will be accompanied by the creation of special review procedures 
which ensure that the defendant has an effective remedy and that a judgment which does not 
respect his right to a fair trial or rights of defence will not take effect. The changes envisaged 
for  the  international  legal  order  will  improve  access  to  justice  in  the  European  Union  for 
citizens,  in  particular  weaker  parties,  and  companies.  The  elimination  of  the  possibilities  of 
circumventing  a  choice  of  court  or  arbitration  agreements  strengthens  access  to  justice  by 
improving  access  to  the  court  chosen  by  the  parties  while  avoiding  dilatory  tactics  which 
could undermine the right to a fair trial. The strengthening of the effectiveness of arbitration 
agreements reduces the risk of parallel proceedings, thereby improving the general efficiency 
of justice and the freedom to conduct a business as referred to in Article 16.  

3.6. 

Social impact 

In  sum,  the  revision  of  Regulation  Brussels  I  will  improve  the  situation  of  weaker  parties, 
notably consumers, employees and insured in cross-border legal disputes. This is first of all 
due to the abolition of exequatur which will allow citizens involved in cross-border litigation 
to save substantial costs and be able to enforce a foreign judgment without the delay caused 
by the existence of the intermediate procedure. Moreover, the increased access to European 
courts  in  transactions  involving  defendants  from  third  countries  will  ensure  that  weaker 
parties  will  be  able  to  avail  themselves  of  the  protection  awarded  to  them  by  European 
legislation.  

3.7. 

Impact on third countries 

The changes envisaged in the reform package will not have an adverse effect on the relations 
of the European Union with third countries. The contemplated harmonisation of the rules of 
jurisdiction  to  cover  defendants  domiciled  in  third  countries  is  fully  in  line  with 
internationally  accepted  standards.  A  defendant  domiciled  in  a  third  country  would  in 

EN 

41 

   EN 

principle only have to appear before an EU court if the case has a substantial link with the EU 
territory; the only exception would apply in cases where the party's right to access to court or 
to  a  fair  trial  would  not  be  guaranteed  in  that  third  country.  Moreover,  the  removal  of  the 
existing  exorbitant  grounds  of  jurisdiction  in  Member  States'  national  law  will  be  to  the 
benefit of third country defendants who no longer risk to be sued in a European court which 
has no or only very little connection with the case. The other elements of the reform package 
will  equally  contribute  to  improving  the  EU's  relations  with  its  international  partners:  the 
modifications  contemplated  in  the  area  of  choice  of  court  agreements  will  facilitate  the 
ratification of the Hague Convention on Choice of Court agreements by the European Union 
which  will  give  a  positive  signal  to  the  international  community.  Moreover,  the  improved 
interface between the Regulation and arbitration will make European arbitration centres more 
attractive  to  companies  from  outside  the  EU.  Finally,  third  country  claimants  which  have 
obtained a judgment in one Member State but need to enforce it in another Member State will 
benefit  from  the  reduction  of  costs  and  delays  brought  about  by  the  abolition  of  exequatur 
procedures.  

4. 

PROPORTIONALITY OF EU ACTION 

Measures taken have to be proportionate to the size and extent of the problems addressed. The 
package  of  preferred  options  outlined  above  respects  the  proportionality  principle.  The 
changes  contemplated  in  the  package  of  preferred  policy  options  do  not  go  beyond  what  is 
necessary to address the problems identified. As outlined above, the benefits and savings of 
the  preferred  policy  options  largely  outweigh  its  costs  and  disadvantages.  The  potential  for 
economic savings is substantial while the financial costs for implementing the reform in the 
Member States are overall small. The reform package has the potential to promote trust in the 
internal  market  and  encourage  more  companies  and  citizens  to  engage  in  cross-border 
transactions,  thereby  reaping  the  benefits  of  the  internal  market.  Such  increased  economic 
activity, taken together with the savings the reform entails, would contribute to help citizens 
and companies overcome the current financial crisis.  

5. 

LEGAL BASIS 

Regulation  Brussels  I  was  adopted  on  the  basis  of  Articles  61  (c)  and  67  (1)  of  the  Treaty 
establishing the European Community. After the entry into force of the Treaty of Lisbon, the 
Treaty basis for the adoption of legislative instruments aimed at ensuring the compatibility of 
the rules applicable in the Member States concerning jurisdiction are Article 67 (4) and 81 (2) 
(a), (c) and (e) of the Treaty on the Functioning of the European Union.  

6. 

MONITORING AND EVALUATION 

In  order  to  monitor  the  effective  application  of  the  amended  Regulation,  regular  evaluation 
and reporting by the Commission will take place. To fulfil these tasks, the Commission will 
prepare regular evaluation reports on the application of the Regulation, based on consultations 
of Member States, stakeholders and external experts. Regular expert meetings will also take 
place to discuss application problems and exchange best practices between Member States in 
the framework of the European Judicial Network. 

In most Member States, there is no systematic collection of statistical data on the application 
of the Regulation making it very difficult to measure how the Regulation affects cross-border 

EN 

42 

   EN 

litigation.  The  Commission  will  therefore  include  in  the  proposed  Regulation  a  requirement 
on  Member  States  to  provide  information  on  the  application  of  the  Regulation  in  practice, 
notably on the number of recourses to the special review procedures created to safeguard the 
defendant's fundamental rights and on the outcome of these procedures.  

EN 

43 

   EN 

ANNEX I –GLOSSARY OF LEGAL TERMS 

Annex I - Glossary 

Term 

Preliminary question 

Anti-suit injunction 

Arbitration 

Choice of court agreement 

Civil and commercial matters 

Civil justice / civil law  

Claimant 

Definition 

in  order 

 Question  which  a  judge  has  to 
to  determine 
examine 
whether  certain  conditions  required 
for  the  existence  of  the  principal 
question are fulfilled. 

A court order which seeks to prevent 
an opposing party from commencing 
or continuing proceedings in another 
jurisdiction  or  forum  by  imposing 
damages in case of non-compliance. 

A  mechanism  for  the  resolution  of 
disputes  outside  the  courts,  wherein 
the  parties  refer  their  dispute  to  one 
or  more  persons  (the  "arbitrators", 
"arbiters"  or  "arbitral  tribunal"),  by 
whose  decision  (the  "award")  they 
agree to be bound.  

An  agreement,  usually  forming  part 
of a contract, by which parties agree 
that any future dispute arising out of 
their relationship should be resolved 
by  a  particular  court  or  courts  (e.g. 
"the  courts  of  England",  "the  upper 
regional court of Duesseldorf"). 

to 

legal 

relationships 
Relates 
between  private 
individuals,  as 
opposed  to  the  relationship  between 
the State and an individual 

Law  that  governs  the  relationships 
individuals  (and 
between  private 
between  private  individuals  and  the 
State  where  the  latter  has  acted  in  a 
private  law  capacity),  as  opposed  to 
the 
public 
relationship  between  the  individual 
and the State.  

law  which  governs 

Any  either  natural  or  legal  person 
who  brings  an  action  against 

EN 

44 

   EN 

 
Declaratory relief 

Defendant 

Enforcement 

Exequatur procedure 

Exorbitant rules of jurisdiction 

Forum  

Forum necessitatis  

Hague  Conference 
International Law 

on  Private 

Interim relief 

somebody (the defendant) in court. 

A  legally  binding  judgment  of  a 
court which determines the rights of 
one or more parties without ordering 
performance or awarding damages. 

Any  natural  or  legal  person  against 
whom an action is brought in court.  

The  act  of  a  public  authority  by 
which  a  judgment  or  administrative 
order  is  put  into  practice  (e.g.  a 
judgment  ordering  a  debtor  to  pay 
100  euros  may  be  enforced  by 
attaching the requisite sum in a bank 
account  of  the  debtor’s  and  then 
disbursing it to the creditor).  

judgment 

Formal  court  procedure  by  which  a 
declared 
foreign 
enforceable 
for 
enforcement) 
the  state  where 
enforcement is sought.  

(i.e.  "validated" 
in 

is 

Rules  of  jurisdiction  in  which  the 
court  seized  does  not  possess  –  by 
internationally  agreed  standards  -  a 
sufficient connection with the parties 
to the case, the circumstances of the 
case,  the  cause  or  subject  of  the 
action.  

A  judicial  body,  e.g.  a  court  or 
tribunal, having jurisdiction. 

[Latin,  ‘forum  of  necessity’]  Forum 
which  may  exercise 
jurisdiction 
when  no  other  forum  is  reasonably 
available 

An  intergovernmental  organisation 
with  its  seat  in  The  Hague,  NL, 
which is working for the progressive 
of 
unification, 
by 
the 
international  conventions,  of 
rules of private international law.  

means 

Measures  ordered  by  a  court  which 
are intended to preserve a factual or 
legal  situation  so  as  to  safeguard 

EN 

45 

   EN 

 
Jurisdiction/International jurisdiction 

Lis pendens or litispendence  

Public policy 

- procedural public policy 

- substantive public policy 

Recognition 

Residual jurisdiction 

rights  the  recognition  of  which  is 
otherwise  sought  from  the  courts  on 
the merits, e.g. the freezing of assets. 

Jurisdiction  is  the  power  conferred 
upon  a  court  or  tribunal  to  hear  a 
specific 
international 
jurisdiction is the competence of the 
courts of a particular country to hear 
a case. 

case; 

[Latin,  ‘pending  suit’]  Situation  in 
which at the moment when one court 
or  authority  is  seized,  another  court 
or authority is already in the process 
of examining the same dispute. 

Law 

Generally understood as the ultimate 
principles  which  underpin  the  legal 
In  Private 
system  of  a  State. 
International 
the 
irreconcilability  of  a  judgment  with 
the  principle  of  public  policy  of  a 
State can lead to the non-recognition 
of  a  foreign  judgment  in  that  State. 
Procedural  public  policy  refers  to 
the  situation  where 
foreign 
procedure  runs  against  the  basic 
legal 
State. 
Substantive public policy relates to a 
irreconcilability  of  the  substance  of 
the  foreign  judgment  with  the  basic 
principles of the State. 

principles 

the 

of 

a 

The  act  of  accepting  a  judgment  or 
other  act  of  sovereignty  of  another 
state  as  if  it  had  been  issued  by  an 
authority of one’s own state. 

Refers  to  the  jurisdiction  that  is  left 
to  be  determined  by  national  law 
where  the  European  law  currently 
does not provide uniform grounds of 
jurisdiction 
in 
situations  where  the  defendant  is 
domiciled outside the EU). 

jurisdiction 

(e.g. 

The  2005  Hague  Convention  on 
choice of court agreements 

framework  of 

International  Convention  adopted  in 
the 
the  Hague 
Conference  on  Private  International 
law  which  governs  exclusive  choice 

EN 

46 

   EN 

 
 
 
 
The  1958 New York  Convention  on 
the  recognition  and  enforcement  of 
foreign arbitral awards 

of  court  agreements  in  cross-border 
business-to-business relationships. 

International  Convention  adopted  in 
the framework of the United Nations 
which  requires  courts  of  contracting 
states to give effect to agreements to 
arbitrate  and 
recognize  and 
to 
enforce  arbitration  awards  made  in 
other contracting states.  

EN 

47 

   EN 

 
ANNEX II – SUMMARY OF VIEWS OF STAKEHOLDERS ON THE MAIN ASPECTS OF THE 

REVISIN OF REGULATION BRUSSELS I 

Views of stakeholders on the main elements of the reform as they result from the consultation 
process are as follows. 

1. 

ABOLITION OF EXEQUATUR 

With respect to the abolition of exequatur, a large majority of stakeholders and all Member 
States supported the objective of a free movement of judgments within the European Union. 
There is general support for  the abolition  of  the exequatur  procedure as  a  means  to  achieve 
this  objective.  A  very  large  majority  of  stakeholders  opined  that  the  abolition  of  exequatur 
should  be  accompanied  by  safeguards,  in  particular  to  protect  the  rights  of  defence  of  the 
party  against  whom  the  enforcement  is  sought.  Views  differed  on  the  extent  of  such 
safeguards  and  on  the  place  where  such  safeguards  should  be  available  (Member  State  of 
enforcement or Member State of origin). Specific concerns were expressed with respect to the 
abolition of the exequatur in defamation cases.  

2. 

OPERATION OF THE REGULATION IN THE INTERNATIONAL LEGAL ORDER 

With  respect  to  the  operation  of  the  Regulation  in  the  international  legal  order,  there  was  a 
general opinion that multilateral negotiations at international level would constitute the most 
appropriate  framework  for  regulation.  Failing  such  framework,  views  diverged  on  the  best 
way forward. While a number of stakeholders and Member States supported the extension of 
the jurisdiction rules to third State defendants, particularly with the aim of ensuring access to 
justice  before  the  courts  in  Europe,  most  stakeholders  thought  that  the  recognition  and 
enforcement of third State judgments should be left to a multilateral framework which would 
ensure reciprocity at international level.  

3. 

CHOICE OF COURT AGREEMENTS 

With respect to choice of court agreements, there was a large support from stakeholders and 
Member States to improve the effectiveness of such agreements. Among the various ways to 
achieve that objective, preference was expressed for granting priority to the chosen court to 
decide on its jurisdiction. Such a mechanism would largely accord with the system established 
in the 2005 Hague Choice of Court Agreements, thus ensuring a coherent approach within the 
Union  and  at  international  level  were  the  European  Union  to  decide  to  conclude  the  2005 
Convention in the future.  

4. 

THE INTERFACE BETWEEN THE REGULATION AND ARBITRATION 

With respect to the interface between the Regulation and arbitration, while many stakeholders 
recognised the problem and supported future action, several arbitrators' associations expressed 
concern on the impact of any regulation on the leading role of European arbitration centres at 
world-wide  level.  Views  diverged  on  whether  the  best  way  forward,  i.e.  either  to  actively 
promote arbitration agreements by avoiding parallel proceedings and abusive litigation tactics 
or to exclude arbitration more broadly from the scope of the Regulation. In any event, most 

EN 

48 

   EN 

stakeholders  expressed  general  satisfaction  with  the  operation  of  the  1958  New  York 
Convention which should not be undermined by any Union action on the matter. 

EN 

49 

   EN 

ANNEX III - SUMMARY OF LEGAL STUDIES CONDUCTED BY THE COMMISSION 

Study  No.  JAI/A3/2002/02  on  making  more  efficient  the  enforcement  of 

1. 
judicial decisions within the European Union 

Following  a  tender  issued  by  the  European  Commission  in  2002,  this  final  report83 
presented  by  Prof.  Dr.  B.  Hess  (University  of  Heidelberg)  in  2004  is  based  on 
comparative research conducted by national reports by then 15 Member States which 
answered to four questionnaires. On the basis of the so obtained detailed information 
on the practice of enforcement in the single Member States, the study analyses in an 
elaborate way the transparency of assets, garnishment, and provisional and protective 
measures in the Member States. It confirms enforcement being the "Achilles heel" of 
the  European  Civil  Judicial  Area,  since  the  non-harmonised  national  enforcement 
systems,  which  also  differ  significantly  in  the  efficiency  of  judicial  enforcement, 
create  an  obstacle  to  the  equality  of  EU  debtors,  the  functioning  of  the  Internal 
Market and generally to the right of a creditor to enforce a claim efficiently within 
the  European  Judicial  Area.  In  conclusion  the  study  stresses  the  need  for  Union 
action  and  proposes  several  measures  to  improve  the  enforcement  of  judicial 
decisions  in  the  European  Union,  notably  the  creation  of  a  European  order  for  the 
attachment  of  bank  accounts,  a  European  protective  order  to  the  same  effect  and  a 
number of measures enhancing the transparency of the debtor's assets. 

Study  JLS/C4/2005/03  Report  on  the  Application  of  Regulation  Brussels  I  in 

2. 
the Member States 

In  September  2007  Prof.  Dr.  B.  Hess,  Prof.  Dr.  Pfeiffer  (University  of  Heidelberg) 
and  Prof.  Dr.  Schlosser  (University  of  Munich)  presented  this  final  report84  which 
was asked by the Commission in order to prepare a report for the Commission on the 
application and on the future revision and improvement of the Brussels I Regulation 
(see  Article  73  of  the  Brussels  I  Regulation).  The  study  provides  a  comprehensive 
analysis on the application of the Brussels I Regulation in 24 Member States on the 
basis of interviews, statistics and practical research in the files of the national courts 
by  means  of  three  questionnaires  which  were  distributed  among  national  reporters. 
The report proposes several improvements concerning Articles 1, 2, 5, 15, 22 (4), 23 
of the Brussels I Regulation and the proceedings for recognition and enforcement of 
foreign judgments as well as Article 49 of the Brussels I Regulation.  

3. 

Study JLS/C4/2005/07 on Residual Jurisdiction 

As  commissioned  by  the  European  Commission,  this  study85  presented  by  Prof. 
Arnaud Nuyts in July 2007 provides a comparative analysis of the issue of "residual 

83 

84 

85 

EN 

is 

final 

report 

The 
http://ec.europa.eu/civiljustice/publications/docs/enforcement_judicial_decisions_180204_en.pdf. 
The 
is 
http://ec.europa.eu/civiljustice/news/docs/study_application_brussels_1_en.pdf. 
The 
is 
http://ec.europa.eu/civiljustice/news/docs/study_residual_jurisdiction_en.pdf. 

available 

available 

available 

English 

English 

English 

report 

report 

final 

final 

only 

only 

only 

in 

in 

in 

50 

at 

at 

at 

   EN 

  
                                                 
jurisdiction"  as  it  appears  firstly  in  the  application  of  the  Brussels  I  Regulation  in 
Article 4 when a defendant is domiciled outside of the European Union, secondly in 
matrimonial  proceedings  with respect  to married couples of Community citizens of 
different nationalities living in a third State in Article 7 of the Brussels II Regulation 
and  thirdly,  in  matters  of  parental  responsibility,  with  respect  to  children  of  EU 
citizenship who are habitually resident outside the EU (Article 14 of the Brussels II 
Regulation). Based on national reports from 27 Member States the study reflects the 
great diversity of the national rules of jurisdiction in force in the 27 Member States 
and proposes a harmonisation of the residual jurisdiction presenting several options 
for Union action in this field. 

Study  to  inform  an  Impact  Assessment  on  the  Ratification  of  the  Hague 

4. 
Convention on Choice of Court Agreements by the European Community 

This  preparatory  study86  presented  by  GHK  (an  independent  multi-discipline 
consultancy  based  in  London)  in  December  2007  was  undertaken  with  view  of 
carrying  out  an  Impact  Assessment  on  the  ratification  of  the  Hague  Convention  on 
Choice  of  Court  Agreements  by  the  EU.  The  Hague  Conference  on  Private 
International Law adopted on June 30th,  2005  the Hague  Convention on Choice of 
Court Agreements. A number of EU and international instruments already existed in 
this  field,  however,  as  pointed  out  by  the  study,  not  with  the  breadth  of  signatures 
and  same  scope  as  The  Hague  Convention  could  have.  The  objectives  of  this 
assignment were to carry out an assessment of the direct and indirect impacts of the 
possible ratification by the European Union of the Hague Convention on the choice 
of  court  agreements  and  other  policy  options  that  could  address  the  underlying 
problems.  The  study  provides  necessary  information  and  assessments,  notably  the 
identification and elaboration of problems to be addressed, policy objectives, added 
value  of  the  Union  level  action  and  risks.  The  study  concludes  by  presenting 
different  policy  options  of  which  the  ratification  by  the  Union  of  the  Hague 
Convention  on  choice  of  court  with  exclusions  under  Article  21  with  respect  to 
copyright and related rights and insurance is recommended.  

86 

EN 

The 
is 
http://ec.europa.eu/dgs/justice_home/evaluation/docs/final_report_071207.pdf. 

available 

study 

final 

in 

English 

51 

only 

at 

   EN 

                                                 
ANNEX IV A - NUMBER AND COST OF EXEQUATUR PROCEEDINGS 

Table 1: Number of exequatur applications and success rate (2009) 

Country 

Austria 

Belgium*† 

Bulgaria 

Cyprus 

Czech 
Rep 

Denmark* 

Estonia 

Finland 

France 

Germany* 

Greece* 

Hungary* 

Ireland 

Italy 

No. 
Appl
icatio
ns 

244 

307 

54 

14 

42 

163 

8 

46 

1,176 

1,638 

500 

53 

127 

1,156 

Success 
rate % 

Country 

93 

95 

56 

75 

93 

95 

78 

100 

99 

88 

95 

88 

93 

93 

Latvia 

Lithuania 

Luxemburg 

Malta 

Netherlands*

Poland 

Portugal 

Romania 

Slovakia 

Slovenia 

Spain 

Sweden 

UK* 

EU27 

No. 
Appl
icatio
ns 

55 

183 

244 

7 

378 

444 

205 

153 

18 

238 

887 

380 

1,202 

9,922 

Success 
rate % 

76 

83 

95 

93 

95 

88 

93 

93 

83 

93 

93 

90 

93 

93 

Source: CSES study, Table 3.2 page 36. Notes: *= estimates based on sample of courts; † = 2008. Figures in 
italics are based on an extrapolation of the data for other countries. A detailed explanation of the methodology 
for scaling up the estimates to an EU27 level is provided in the appendices.  

Table 2: Estimated Cost of Exequatur Proceedings – 2009 (Euro) 

Country 

Austria  

Belgium  

Court 
Fees 

200 

30 

Other 
fees 

850 

850 

Total 
fees 

2,786  

1,893  

Legal 
fees 
(5h) 

1,736 

1,013 

52 

   EN 

EN 

 
 
 
Bulgaria  

Cyprus  

Czech 
Rep 

Denmark  

Estonia  

Finland  

France  

Germany  

Greece  

Hungary  

Ireland  

Italy  

20 

395 

50 

80 

20 

179 

500 

400 

10 

15 

110 

300-
500 

232  

579  

434  

1,736 

1,013 

1,736 

1,736 

1,736 

1,013 

1,013 

2,605 

2,605 

850 

850 

850 

850 

850 

850 

850 

850 

850 

850 

850 

850 

1,102  

1,824  

1,334  

2,666  

1,883  

2,765  

3,086  

2,986  

1,873  

1,878  

3,565  

3,855  

Source: CSES study, p. 42. 

Scenarios 

For  the  purposes  of  this  study,  estimates  are  based  on  two  scenarios:  firstly,  a 
straightforward  case  in  which  exequatur  is  granted  without  any  appeal  or 
complication  concerning  the  good  order  of  the  paperwork  of  the  application,  and 
enforcement is not contested; and, secondly, a more complex, appealed case with the 
need for documentation to be translated, legal representation, etc.  

Scenario 1 - a ‘straightforward’ case where a 25-page document is translated, court 
fees  are  paid  in  addition  to  lawyers’  charges  for  five  hours.  The  average  cost  of 
exequatur  proceedings  is  €2,208  (see  Table  above). On  this  basis,  if  all  exequatur 
cases  were  ‘simple’,  the  total  cost  of  exequatur  cases  in  2009  would  have  been 
around €22 million (9,922 cases x €2,208). 

Scenario  2  -  a  more  complex  or  contested  case,  the  total  cost  of  exequatur  can 
increase exponentially, especially because of the extra costs of translation and above 
all, further lawyer's fees. In order to develop this scenario, the costs have been based 
on new research and on the report on the cost of civil judicial proceedings in the EU. 
This  scenario  is  based  on  an  estimated  100  pages  to  be  translated  (at  an  estimated 
cost of €30) and five days of lawyers’ fees  (lawyers’ fees in different Member States 

EN 

53 

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87) giving an average cost for the more complex 
vary from €40 to over € 500 per hour
case of €12,791. If all exequatur  cases were ‘complex’, the total cost of exequatur in 
2009 would have been around €126 million (9,922 cases x €12,791).  

Table  3  summarises  the  total  cost  of  exequatur  proceedings  based  on  different 
assumptions for ‘simple’ and ‘complex’ cases and a total of 9,922 cases in 2009. 

Table 3: Total Cost of Exequatur Proceedings based on different scenarios – 2009 

Scenario 

Total EU cost of exequatur  

100% of cases are ‘simple’ 

EUR 21,906,976  

25%  of  cases  are  ‘complex’  (Base 
Scenario) 

EUR 47,893,943  

50% of cases are ‘complex' 

EUR 73,880,909  

75% of cases are 'complex' 

EUR 99,867,876  

100% of cases are ‘complex' 

EUR 125,854,842  

The  study  has  found  that  an  estimated  93%  of  applications  are  successful. On  the 
basis  that,  at  most,  around  25%  of  cases  are  ‘complex’  and  belong  to  the  second 
scenario, the base scenario is that the total cost of exequatur proceedings in 2009 
would have been around €48 million .  

Source: CSES study, Table 3.4 p. 44ss. 

87 

Lawyers' fees were calculated on the basis of the country report (annexes) of the Study on the 
Transparency of Costs of Civil Judicial Proceedings in the European Union. 

EN 

54 

   EN 

                                                 
ANNEX IV B – EXAMPLE OF ITEMISED COSTS OF EXEQUATUR 

Example  of  a  "straightforward"  case  of  obtaining  exequatur  for  a  French  judgment 
over € 14,000 from the Appellate Cour t of Douai in Antwerp, Belgium 

frais de mise au rôle : € 52 

traduction  de  l’arrêt  du  français  au  néerlandais :  +/-  €  500  (dans 
sera demandé que ces frais soient mis à charge de XXX) 

la  requête  en  exequatur,  il 

signification de la décision accordant l’exequatur (art. 42(2) Règlement) à XXX : +/- € 250 

droits d’enregistrement : nihil 

élection de domicile dans le ressort d’Anvers : nihil 

honoraires : € 875 (si le tribunal convoque la re quérante, ce montant devrait être révisé)88 

Total : € 2,145  

Documents à produire : 

expédition de l’arrêt ; 

certificat  délivré  par  la  Cour  d’Appel  de  Douai  (sur  base  de  l’article  54  du  Règlement 
44/2001 ; ce certificat atteste entre autre que la décision française est exécutoire en France ; si 
la  Cour  d’Appel  n’a  pas  délivré  le  certificat,  deux  solutions  sont  possibles :  soit  solliciter  à 
nouveau  la  Cour  d’Appel  pour  qu’elle  délivre  le  certificat,  soit  demander  l’exequatur  en 
produisant une attestation démontrant que l’arrêt de la Cour d’Appel a été signifié) ; 

un mandat au nom de l’ensemble des requérants, qui couvre l’exécution de l’arrêt ; 

mise en demeure de XXX 

88 

In Belgium, lawyers' fees for an exequatur seem to vary between € 800 and € 2,000. 

EN 

55 

   EN 

                                                 
ANNEX V - LENGTH OF EXEQUATUR PROCEEDINGS 

1. 

First instance 

Member State 

Austria 

Belgium 

Cyprus 

Czech Republic 

England&Wales 

Estonia 

Finland  

France 

Germany 

Greece 

Hungary 

Ireland 

Italy 

Latvia 

Lithuania 

Luxembourg 

Malta 

Netherlands 

Poland 

Portugal 

Scotland 

Average duration  

1 week 

1-4 months 

1-3 months 

n.a. 

1-3 weeks 

3-6 months 

2-3 months 

10-15 days 

3 weeks 

10 days-7 months 

1-2 hours 

1 week or more 

Milan:  20-30  days;  Bolzano:  7-20 
days 

10 days 

up to 5 months 

1-7 days 

Exemplary 
cases  with 
single 
procedures  concluded  within  days 
up to three months  

n.a. 

1-4 months 

n.a. 

n.a. 

EN 

56 

   EN 

Slovakia 

Slovenia 

Spain 

Sweden 

n.a. 

n.a. 

n.a. 

2-3weeks 

2.  Appeal proceedings 

Member State 

Average duration  

Austria 

Belgium 

Cyprus 

Czech Republic 

England&Wales 

Estonia 

Finland  

France 

Germany 

Greece 

Hungary 

Ireland 

Italy 

Latvia 

Lithuania 

Luxembourg 

Malta 

n.a. 

Liège:  1  year;  Antwerp:  1  year; 
Brussels: up to 2 years 

no information available 

n.a. 

1-2 months 

6 months to 1-2 years 

6 months 

no information available 

1-6  months;  applications  which 
obviously  have  no  chance  of 
success  are 
immediately  closed 
within a period of 1-2 weeks 

6-10 months 

3 months (in more than 50 % of the 
cases) 

n.a. 

about 2 years 

2-6 months. 

up to 2 months; 

10-12 months 

first  hearing  after  2  years;  decision 

EN 

57 

   EN 

 
Netherlands 

Poland 

Portugal 

Scotland 

Slovakia 

Slovenia 

Spain 

Sweden 

3-12 months later 

n.a. 

1-3 months 

4-5 months 

n.a. 

n.a. 

2-12 months 

2-4 months 

n.a. 

EN 

58 

   EN 

 
ANNEX VI – EFFECT OF THE RISK OF LITIGATION ABROAD ON CROSS BORDER TRADE AND 

POSSIBLE IMPACT OF ABOLITION OF EXEQUATUR  

Survey  Evidence  -  Effect  of  the  Risk  of  Litigation  Abroad  on  Cross  Border  Trade 
and Possible Impact of Abolition of Exequatur 

•  51.4%  of  the  mainly  smaller  businesses  participating  in  the  EBTP  survey  stated 
that  the  risk  of  a  potential  dispute  was  either  ‘very  important’  or  ‘important’  in 
deciding  whether  or  not  to  expand  activities  in  other  European  countries  (see 
Table 2.3) 

•  55.9% mainly larger companies that completed the key stakeholder questionnaires 
indicated  that  the  risk  of  litigation  in  another  country  had  either  ‘some  effect’ 
(32.4%)  or  a  ‘major  effect’  (23.5%)  on  their  attitude  to  cross-border  trade.  A 
similar  proportion  of  consumer  organisations  (51.4%)  indicated  that  the  risk  of 
litigation had a discouraging effect on consumers’ willingness to engage in cross-
border transactions (25.7% discouraged a bit’ and 25.7% ‘entirely discouraged’).  

Figure 1: What effect (if any) does the risk of litigation in another Member State in a cross-
trade? 
border 

cross-border 

attitude 

dispute 

have 

your 

on 

to 

Businesses

Consumer organisations 

40.0

32.4

25.7

25.7

23.5

23.5

45

40

35

30

25

20

15

10

5

0

20.6

8.6

No effect 

Some effect 

Major effect

Don't know or not 
applicable

•  39.4%  of  businesses  and  consumer  organisations  responding  to  the  key 
stakeholder  survey  went  on  to  say  that  they  would  be  ‘a  lot  more  inclined’  to 
engage in (more) cross-border commercial activities if a judgment obtained in one 
Member  State  was  enforceable  in  another  Member  State  without  additional 
procedures. 

Figure 2: To what extent would you be inclined to engage in (more) cross-border commercial 
activity  if,  in  the  event  of  a  dispute,  a  judgment  obtained  in  one  Member  State  would  be 
enforceable in another without additional procedures? 

EN 

59 

   EN 

 
39.4

45

40

35

30

25

20

15

10

5

0

26.7

21.1

2.8

4.2

5.8

A lot more 
inclined 

Slightly more 
inclined 

Neutral

Slightly less 
inclined

A lot less 
inclined 

Don't know or 
not applicable

Source: CSES study, Text box 3.3, p. 61 

EN 

60 

   EN 

 
ANNEX VII – SUMMARY OF RELEVANT CASES OF THE COURT OF JUSTICE OF THE 

EUROPEAN UNION 

1. 

Erich Gasser GmbH v MISAT Srl; Case C-116/02, 9 December 2003 

In  its  decision  the  ECJ  had  to  answer  several  questions  submitted  by  an  Austrian 
court  which  had  been  appealed  by  Gasser,  after  an  Austrian  Regional  Court  had 
stayed its proceedings according to Article 21 of the Brussels Convention (Article 27 
of  the  Brussels  I  Regulation),  since  it  found  that  the  decision  of  an  Italian  Court 
before which MISAT had brought action against in an earlier point of time. Gasser 
held,  that  that  the  parties  had  concluded  a  choice  of  court  agreement  conferring 
jurisdiction  on  the  Austrian  court.  The  ECJ  decided  that  a  national  court  whose 
jurisdiction  has  been  claimed  under  a  choice  of  court  agreement  has  to  stay  its 
proceedings  according  to  Article  21  of  the  Brussels  Convention  (Article  27  of  the 
Brussels  I  Convention)  until  the  court  previously  seised  has  declared  that  it  has  no 
jurisdiction, even if this takes an excessively long time.  

Brigitte and Marcus Klein v Rhodos Management, Ltd.; C-73/04, 13 October 

2. 
2005 

The  ECJ  addressed  the  characterisation  of  a  complex  contract  under  which  the 
German  married  couple  Klein  became  member  of  a  club  which  gives  access  to 
several services in return for annual fees as a requirement for the purchase of a right 
to  use  a  holiday  property  on  time  share  bases  under  the  same  contract  (against 
separate payment) for nearly 40 years. The Court decided that such a contract, where 
the  costs  for  the  membership  represent  the  major  part  of  the  total  price  cannot  be 
considered a contract which has as its object "…tenancies of immovable property" in 
the  sense  of  Article  16(1)(a)  of  the  Brussels  Convention  (Article  22(1)  of  the 
Brussels  I  Regulation)  so  that  courts  in  the  Member  State  where  the  respective 
property is situated do not have jurisdiction according to this Article. 

3.  Allianz  SpA,  formerly  Riunione  Adriatica  di  Sicurtà  SpA  and  Generali 
Assicurazioni Generali SpA v West Tankers Inc.; Case C-185/07, 10 February 2009 

The  ECJ  had  to  determine  whether  an  anti-suit  injunction  granted  in  face  of  the 
existence  of  an  arbitration  agreement,  restraining  from  pursuing  any  other 
proceedings  than  arbitration  and  therefore  preventing  a  previously  seised  national 
court  from  examining  itself  if  it  has  jurisdiction  is  reconcilable  with  the  Brussels  I 
Regulation.  Allianz  had  brought  proceedings  against  West  Tankers  to  an  Italian 
national  court  in  order  to  recover  a  compensation  paid  to  a  contracting  partner  of 
West  Tankers,  whereupon  the  latter  started  proceedings  before  a  national  court  in 
London  (which  was  also  the  chosen  place  for  arbitration  proceedings)  seeking  an 
anti-suit  injunction.  In  response  to  the  submissions  made  by  the  English  national 
court,  the  ECJ  stated  that  despite  the  arbitration  exception  in  Article  1(2)(d)  the 
Brussels I Regulation applies to issues concerning the applicability of an arbitration 
agreement,  including  in  particular  its  validity,  when  the  subject  matter  of  a  dispute 
comes  within  the  scope  of  the  Brussels  I  Regulation.  An  anti-suit  injunction 
preventing  a  court  of  a  Member  State  from  determining  itself  whether  it  has 
jurisdiction is irreconcilable with the Brussels I Regulation. 

EN 

61 

   EN 

ANNEX VIII – NATIONAL PROTECTIVE JURISDICTIONAL GROUNDS IN CONSUMER, 

EMPLOYMENT AND INSURANCE CONTRACTS 

Member 
State 

Austria 

Belgium 

Bulgaria 

Cyprus 

Czech 
Republic 

Denmark 

England 

Estonia 

Finland  

France 

Germany 

Greece 

Hungary 

Ireland 

Italy 

Rights  for  a 
CONSUME
R 
to  bring 
proceedings 
at home 

- 

+ 89 

+ 90 

- 

- 

+ 89 

- 

+ 90 

+ 90 

- 

- 

- 

+ 89 

- 

+ 89 

of 

Right 
EMPLOYE
ES  to  bring 
proceedings 
certain 
at 
defined 
places  

+ 91 92 

+ 91 

+ 91 

- 

- 

- 

- 

+ 91 92 

+ 91 93 

+ 93 

- 

+ 91 93 

+ 91 

- 

+ 91 

of 

Right 
INSURED 
to 
bring 
proceedings 
at 

home 

- 

- 

- 

- 

- 

- 

- 

- 

- 

+ 

- 

- 

- 

- 

+ 

89 
90 
91 

Jurisdiction subject to a territorial connection with that State.  
Without restriction.  
At the place where the employee carries out his work. 

EN 

62 

   EN 

 
                                                 
Latvia 

Lithuania  

Luxembourg

Malta 

Netherlands 

Poland 

Portugal 

Romania 

Scotland 

Slovakia 

Slovenia 

Spain 

Sweden 

- 

+ 90 

+ 89 

- 

+ 89 

- 

- 

- 

+ 89 

- 

- 

+ 89 

- 

+ 91 92 

+ 91 

+ 91 

- 

+ 91 92 

- 

+ 91 

+ 92 

+ 92 

+ 92 

+ 91 

+ 91 93 

+ 92 

- 

- 

+ 

- 

- 

- 

- 

- 

- 

+ 

- 

- 

- 

92 
93 

At the domicile/residence of the employee. 
At the place the contract was concluded. 

EN 

63 

   EN 

 
                                                 
ANNEX IX - MAIN CATEGORIES OF SPECIFIC NATIONAL RULES ON JURISDICTION EXCLUDED 
BETWEEN MEMBER STATES (LISTED IN ANNEX I OF THE BRUSSELS I REGULATION  

Member 
State 

Austria 

Belgium 

Bulgaria 

Cyprus 

Czech 
Republic 

Denmark 

England 

94 
95 

Without further conditions. 
With restrictions.  

EN 

Loc
atio
n 
of 
ass
ets 
of 
def
end
ant 
on 
the 
terr
itor
y 

+ 
96 

+ 
96 

+ 
96 

+ 96 

Citi
zen
shi
p 
of 
the 
part
ies 

+ 94 

+ 95 

Pre
sen
ce 
of 
the 
def
end
ant 
on 

terr
itor
y at 
the 
tim
e of 
ser
vic
e 

of 
clai
m 

+ 

64 

Do
mic
ile 
of 
the 
plai
ntif
f 

plai
ntif
f 

+ 
99 

Ca
use 
of 
acti
on 
or 
acti
viti
es 
in 
the 
terr
itor
y 

+ 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                 
94 

+ 
94 

+ 
94 

+ 
94 

+ 
94 

+ 
96 

+ 
96 

+ 
96 

+ 97 

+ 
96 

+ 
96 

+ 
95 

+ 
94 

+ 
94 

+ 
95 

Estonia 

Finland  

France 

Germany 

Greece 

Hungary 

Ireland 

Italy 

Latvia 

Lithuania  

Luxembour
g 

Malta 

Netherlands 

Poland 

Portugal 

Romania 

+ 98 

+ 99 

+ 

+ 

96 
97 
98 
99 

Even if not related to the claim. 
Only if related to the claim. 
Only for claims relating to the return of a personal property or the reimbursement of its value. 
Repelled. 

EN 

65 

   EN 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
                                                                                                                                                         
+ 
95 

+ 
95 

+ 
95 

Scotland 

Slovakia 

Slovenia 

Spain 

Sweden 

+ 
96 

+ 
97 

+ 
97 

+ 
96 

EN 

66 

   EN